Volkswagen to cut 269 jobs at its all-electric plant in Germany

Volkswagen to cut 269 jobs at its all-electric plant in Germany

German auto manufacturer Volkswagen is to let go of 269 employees on fixed-term contracts at its all-electric plant in Zwickau, eastern Germany, due to flagging demand, a group spokesman announced on Thursday.

More than 2,000 temporary employees, out of a total workforce of 10,700, work at this plant in Saxony, regarded as the group’s electromobility spearhead. However, faced with a drop in new orders, Europe’s leading carmaker has decided to release 269 employees whose contracts expire at the end of October.

The decline in demand is due to a combination of reasons: persistently high inflation, which is undermining purchasing power, recession, and consumer insecurity, to which must be added the end of incentives for the purchase of commercial electric vehicles since September 1, the spokesman told French news agency AFP.

Volkswagen is also facing increasing competition from Tesla and a growing number of Chinese carmakers.

The decision, announced by management at a company meeting, is “a personal disaster for the 269 people involved and their families,” local IG Metall union official Thomas Knabel was quoted as saying in a statement.

The group - which manufactures 10 brands, including Audi, Seat and Skoda – has invested billions of euros in recent years to make its transition to electric vehicles.

The Zwickau plant, which produces six of the group’s electric brands, “plays a central role," the spokesman said. "We have invested €1.2 billion in the plant in recent years,” he said.

In this regard, European Commission President Ursula von der Leyen announced on Wednesday that she was opening an investigation into Chinese subsidies for electric cars, a move welcomed by EU manufacturers, who denounce unfair competition.

The IG Metall union criticised the plant’s management for leaving employees in doubt for a long time in recent weeks, creating “massive insecurity among the workforce and throughout the region.”

However, it welcomed the willingness shown by management “to respond in close consultation with union representatives.”


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