Volkswagen is now under such pressure that, according to the news agency Reuters, the brand cannot avoid anything other than factory closure. It costs thousands a fire ticket.
Volkswagen's financial problems have reached a critical point where drastic measures such as layoffs and closing factories in Germany are being discussed.
The car manufacturer is struggling with a growing debt and a depressed economic climate that necessitates extensive savings.
The Financial Times writes that Volkswagen is considering closing three factories in Germany and laying off tens of thousands of employees. In addition, there are plans to reduce employees' wages by ten percent.
Daniela Cavallo, the main representative of VW employees, has told the Financial Times that management has two days to change plans, otherwise employee strikes will be a real possibility.
– The management is absolutely serious about all this. This is not a way to rattle the sabers in the collective agreement negotiations, she tells Reuters.
The closure of factories in Germany will be a historic event for the 87-year-old car manufacturer. Volkswagen currently has ten factories and 300,000 employees in Germany.
Several factors contribute to Volkswagen's financial challenges. The competition from Chinese manufacturers, falling sales in the largest markets and the high costs associated with the conversion to electric cars are putting pressure on the company.
Volkswagen recently lowered its earnings expectations, citing a challenging market.
Automotive News Europe writes that Volkswagen is investigating various measures to reduce costs, including wage cuts and limiting bonuses.
Volkswagen has refused to comment on the case and calls it speculation about the negotiations between the manufacturer, IG Metall and the employee representatives.
