Volkswagen warns it may close factories

In a statement released by the German company following a recent board meeting, it was announced that a comprehensive restructuring of the brands under Volkswagen AG is necessary.

The statement noted that restructuring based solely on demographic trends is insufficient to implement the structural adjustments needed in the short term to increase the company's competitiveness, stating, "In the current situation, the closure of vehicle production and component manufacturing facilities can no longer be ruled out if rapid countermeasures are not taken."

The German manufacturer, which announced that it is ending a previously valid job security agreement that prevented layoffs until 2029, stated that all measures regarding this matter will be evaluated with the Works Council.

"GERMANY IS FALLING FURTHER BEHIND IN TERMS OF COMPETITIVENESS"

Volkswagen CEO Thomas Schaefer stated that the economic environment has become very difficult and noted that there are new competitors in the European automotive market.

Schaefer remarked, "As a business location, Germany is falling further behind in terms of competitiveness," and emphasized that Volkswagen needs to do more to save costs.

In a statement from the Volkswagen Works Council, it was stated that the brand plans to close a major vehicle factory and a component production plant in Germany, and a message was given that the company's board of directors' plans would be "resisted."

The Volkswagen Group employs approximately 650,000 people across 114 production facilities in 17 European countries and 10 countries in the Americas, Asia, and Africa.

The company's employment in Germany reaches approximately 300,000 people. The Volkswagen Group had planned to reduce personnel costs by one-fifth by 2026 as part of its 10 billion euro savings and cost-cutting measures through 2026.