Volkswagen’s home state says it will not tolerate axing of 30,000-odd jobs in transition to e-cars

The home state of Volkswagen, Lower Saxony, would not tolerate a large-scale reduction in staff at Germany’s largest carmaker, state premier Stephan Weil (SPD) said in an interview with newspaper Die Welt. “Such an approach would not be possible in Lower Saxony,” Weil told the newspaper in response to media reports that Volkswagen plans to axe up to 30,000 jobs due to restructuring required by the transition to electric vehicles. Lower Saxony is a major shareholder in Volkswagen and can thus directly influence the company’s management decisions. Weil added that the carmaker had already said it did not consider job cuts at this scale. “Volkswagen is in a relatively comfortable position because the restructuring process was initiated earlier than at some competitors,” he said, arguing that the company and the state would continue to coordinate efforts in the technological shift to ensure an orderly transition. According to a report carried by business newspaper Handelsblatt, Volkswagen CEO Herbert Diess had told the company’s board that tens of thousands of jobs are at stake if Volkswagen does not manage to accelerate its shift to e-cars. Diess reportedly said that stiff competition on the e-car market, especially by US carmaker Tesla, which plans to produce up to half a million vehicles per year at its new gigafactory plant near Berlin, would command tough decisions. According to news agency Reuters, Tesla plans to build 500,000 cars per year with only 12,000 employees at its German factory, whereas Volkswagen produces 700,000 cars with 25,000 employees at its main plant in Wolfsburg in Lower Saxony. "Tesla is setting new standards for productivity and scale,” a Volkswagen spokesperson told Reuters, adding that “no concrete scenarios” for how the German company plans to respond have been drawn up. In a separate article, Handelsblatt reported that Diess had invited Tesla CEO Elon Musk to speak at a manager meeting in Austria, where the Volkswagen head told Musk he would soon visit the new Tesla factory.

The shift to electric cars has led to worries in Germany’s famed car industry that many jobs could be lost, as combustion engine vehicles are replaced with battery-driven cars. While brands of the Volkswagen Group,  Mercedes and BMW all have announced far-reaching plans to restructure their production, smaller producers that supply the combustion engine industry could face much greater difficulties in weathering the shift to electric mobility.