Volkswagen to cut 30,000 jobs
By Andreas Cremer and Jan Schwartz
WOLFSBURG, Germany (Reuters) - Volkswagen (VOWG_p.DE: Quote) and its labor unions agreed to cut 30,000 jobs at the core VW brand in exchange for a commitment to avoid forced redundancies in Germany until 2025, a compromise which leaves the carmaker's profitability still lagging rivals.
The turnaround plan announced on Friday will lead to 3.7 billion euros ($3.9 billion) in annual savings by 2020 and lift the Volkswagen (VW) brand's operating margin to 4 percent that year, from an expected 2 percent in 2016.
VW, Europe's largest carmaker, is seeking to move beyond an emissions-cheating scandal that has tarnished its image and left it facing billions of euros in fines and settlements.
The cuts came with a management pledge to create 9,000 new jobs in the area of battery production and mobility services at factories in Germany as part of efforts to shift toward electric and self-driving cars.
"We have to invest billions of euros in new cars and services while new rivals will attack us - the transformation will surely be more radical than everything we have experienced to date," VW brand CEO Herbert Diess said at a press conference.
DEEP ENOUGH? Continued...