Due to the decreasing demand for electric cars, VW is laying off a large part of its staff ᐉ News from Fakti.bg – Auto

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Volkswagen Group plans to cut administrative staff in Germany to boost profitability in 2024. This came just a day after it reported a sharp drop in profit for the first quarter of the year. Volkswagen is offering about $1 billion in bonuses to employees who decide to end their contracts early.

First-quarter shipments actually rose 3% year-over-year, but sales of electric vehicles fell sharply. Sales of electric vehicles were positive only in China (+91% compared to the same period last year) and decreased in Europe (-24%) and the USA (-16%).

The company reported sales revenue of 75.5 billion euros, up from 76.2 billion in the first quarter of 2023. In the report, Volkswagen cited “decreasing sales volumes of electric vehicles, the unfavorable state of the global economy as well as increasing fixed costs” as reasons for the modest results for the first quarter of 2024.

Following the publication of the reports, Volkswagen Group Chief Financial Officer Arno Antlitz explained that the company needs to cut costs and that it intends to do so by offering bonuses to any employee willing to leave early.

According to information from Automotive News Europe, Volkswagen Group intends to offer bonuses to a number of administrative employees who will terminate their employment contracts early.

The German automaker has earmarked 900 million euros for bonuses to employees who leave voluntarily, which is expected to take place this quarter. The report states that experienced administrative staff working in Germany can receive a bonus of 50,000 euros in addition to compensation, which depends individually on the level of pay and length of service at Volkswagen.

The cuts are part of the brand’s business strategy to remain competitive with Stellantis and Chinese automakers that continue to expand their presence in the EU. First of all, we are talking about XPeng, NIO, Geely, BYD and Zeekr.

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