Volkswagen may keep German factories

Enterprises that were threatened with closure may remain in operation: Volkswagen is close to reconciliation with striking unions, Bloomberg writes, citing insiders. The auto giant’s management agrees to preserve the factories and renew job guarantees until the end of the decade if workers refuse bonus payments.

Volkswagen, forced to take tough measures to save money, is also planning to move production of the Golf hatchback from Wolfsburg, Germany to Mexico. In addition, he will reduce the production of Volkswagen electric cars at the Zwickau plant, which the company previously invested billions in adapting to “battery” cars on the MEB platform. The ID.3 and ID.4 will move to Wolfsburg and Emden respectively.

This is expected to save four billion euros a year and save the company from overproduction. Now production volumes of Volkswagen electric cars exceed demand: sales are falling in China, Europe and the USA. Volkswagen shares have already fallen 22 percent this year.

Volkswagen has stopped production of the VR6 engine, which was in service for 34 years. European brands are raising prices for fuel cars and giving discounts on electric cars. Rivian will help Volkswagen develop a new electric Golf.

Negotiations between management and representatives of trade unions, which have already entered the fifth round, are due to end on Friday. However, insiders are not yet completely confident that an agreement will be reached.

Previously, Volkswagen was going to take much more radical measures than canceling bonuses. The auto giant planned to cut wages, cut jobs and close at least three enterprises. This caused a violent reaction from employees and caused strikes that brought out tens of thousands of people.

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