VW confirms it is working on a future restructuring plan

Volkswagen confirmed on Friday that it is working on a future restructuring plan but said it does not wish to comment in detail on reports of stricter cost-cutting measures at this stage. 

"The underlying issues are being discussed and approved by the relevant bodies. We will not pre-empt this process," a spokesman said in response to an enquiry.

At the same time, he confirmed that the group executive board had "been working intensively over the past few months on a future plan for the company's reorganization." 

"The aim is to make the company as a whole more efficient and leaner, and to consistently exploit potential for technological synergies," the spokesman said.

The goal is a "comprehensive transformation", he continued. "The entire group - including brands and subsidiaries - must undergo far-reaching change." 

The next step, following consultation with the supervisory board, is to put this into practice. The spokesman did not provide any details on specific measures.

Citing insiders, the German-language Manager Magazin reported earlier on Friday that up to 100,000 jobs could be lost at VW worldwide, twice as many as previously planned. Four plants in Germany are facing closure, it said.

According to the report, the plans are due to be discussed by the supervisory board on July 9.

Employee representatives make up half of the board's members; together with the two representatives from the state of Lower Saxony, where the Wolfsburg headquarters are located, they hold a majority. The state holds a 20% stake in VW.

According to the report, the four plants that could be closed are the VW plants in Hanover, Zwickau and Emden, as well as the Audi site in Neckarsulm. 

The magazine did not specify a concrete date for the measures. According to the report, they could be closed "in the medium term."

Criticism from union and works council

The trade union IG Metall and the Volkswagen works council have strongly criticized reports of possible tougher cost-cutting plans at the German carmaker. 

"Should such plans be pushed ahead with, we would do everything in our power to prevent them," a joint statement by IG Metall leader Christiane Benner, regional director Thorsten Gröger and works council chair Daniela Cavallo said on Friday.

"The renewed media reports are rightly causing concern amongst our workforce and in the regions where our sites are located," the statement read. "Attacks on the VW Act, co-determination and our sites are irresponsible threats."

The VW Act is a special German law that regulates the ownership structure, voting rights and protection against hostile takeovers at Volkswagen AG.

The premier of the state which houses one of the plants potentially facing closure expressed concern over possible tougher cost-cutting measures at VW. "This must not be allowed to happen. Germany must not allow itself to be run down," said Michael Kretschmer, premier of Saxony, where Zwickau is located. 

Germany must be determined to win the battle for international competitiveness. To achieve this, costs must be reduced and productivity increased, Kretschmer said.

Volkswagen is part of Germany's brand identity, emphasized Kretschmer. "If this company gives up, it will be disastrous for our entire country."

An employment guarantee, agreed with the IG Metall trade union, remains in place at the group's German sites until at least 2030. Volkswagen has already announced the loss of 50,000 jobs across the group by 2030, 35,000 of which are at the core VW brand.