Ford EV Partner VW May Close Several Plants In Germany

Ford has faced its fair share of struggles in Europe as of late, and as such, has initiated a few rounds of layoffs in that region. However, it isn’t alone in that regard, as its partner and rival Volkswagen Group is also in dire financial straits – which may prompt it to close at least one of its German plants, as Ford Authority reported early last month. though according to its works council, the automaker considers one large vehicle plant and one component factory in that same country to be obsolete as well. Now, it seems as if the possibility that VW may close multiple plants in Germany continues to grow.

According to CNBC, VW is planning on “the closure or size reduction of its plants in Germany,” information that it obtained from the works council. Those moves include the closure of three plants in Germany, while VW also intends to downsize several others as part of a handful of cost-cutting measures. On top of that, VW reportedly presented the works council with plans to reduce wages by 10 percent across the board, and initiate wage freezes in 2025 and 2026. Additionally, workers are facing the potential loss of bonus and anniversary payouts. Layoffs could reportedly reach totals in the tens of thousands, too.

“In concrete terms, this means taking out even more products, volumes, shifts and entire assembly lines far beyond to what we have already done,” Daniela Cavallo, head of the works council. said in a statement. “All German VW plants are affected by this. None of them are safe.” In a separate statement, Volkswagen stated that it needed to make these moves in response to poor economic conditions and noted that it needs to free up cash for investments that will help it remain competitive, as well as ensure its financial heath and well-being moving forward.

Ford has also closed some European plants in recent years and retooled several others amid similar issues across Europe, and it clearly isn’t alone, either. Volkswagen is particularly exposed, however, as its commitment to electric vehicles hasn’t panned out amid declining demand, which recently prompted it to announce that it would instead focus more on hybrids in the near future.