The figure covers around €10 billion in costs associated with workforce reductions of up to 60,000 positions, while the remainder is linked to the potential phase-out of production at Emden, Zwickau, Hanover and Neckarsulm. The four sites are expected to lose their current production programmes during the next decade, with Volkswagen exploring alternative uses for the facilities.
The latest figures, as reported by the BBC, follow an agreement reached between Volkswagen management, labour representatives and other stakeholders last week, which approved a further 50,000 job reductions on top of cuts already agreed. The deal represents the largest restructuring in the group’s history.
The scale of the overhaul builds on ILM’s earlier reports that Volkswagen was considering up to 100,000 job cuts and changes to its German manufacturing footprint, as confirmed by Reuters in June.
Volkswagen is undertaking the restructuring as it contends with excess capacity, weaker sales in China, growing competition from Chinese manufacturers and U.S. tariffs. The group has also committed to simplifying its business and product range as it seeks to restore profitability and competitiveness.
The company has not confirmed the €16 billion cost estimate, which Reuters reported, citing a report by Der Spiegel.
