At least three manufacturing plants of Volkswagen to close in Germany

BERLIN, Germany: Volkswagen plans to close at least three manufacturing plants in Germany, according to the head of the company's employee council, Daniela Cavallo, who announced the news to workers at Volkswagen's Wolfsburg headquarters.

She said that management is considering further cuts at other locations, warning that "all German VW plants are affected by these plans. None is safe," as reported by German news agency dpa.

While Volkswagen's leadership has not disclosed specific details, chief personnel officer Gunnar Kilian stated that "the situation is serious" and emphasized the responsibility of all negotiating partners, underscoring the urgent need for action in the face of significant industry challenges.

In early September, Volkswagen indicated that competitive pressures and rising costs in Germany could force it to abandon a longstanding job protection agreement that prevents layoffs until 2029. CEO Oliver Blume pointed to competition from new market entrants and Germany's declining appeal as a manufacturing base, stating that the company must "act decisively" to safeguard its future.

Kilian further noted that without substantial measures to regain competitiveness, Volkswagen would struggle to fund crucial future investments. However, he confirmed that management intends to engage in discussions with employee representatives before making final decisions.

Volkswagen, which employs approximately 120,000 workers across its 10 German plants, faces intensifying competition from low-cost Chinese electric vehicles. The company recently reported that it is unlikely to reach its target of 10 billion euros (US$10.8 billion) in cost savings by 2026.

The IG Metall industrial union criticized Volkswagen's potential closures, calling instead for sustainable, future-oriented strategies. "We expect Volkswagen to bring viable concepts to the negotiating table rather than proposing drastic cuts," said regional union leader Thorsten Groger.

Volkswagen and union representatives are scheduled to resume pay negotiations on October 30.