Europe’s largest car company Volkswagen wants to benefit significantly from the savings efforts in its brands as early as 2024. “As early as next year, we plan to achieve an effect of more than 10 billion euros for the group through our brands’ performance programs,” said CEO Oliver Blume (55) to the “Frankfurter Allgemeine Zeitung”.
The efficiency gains would not have a one-to-one impact on the result, but would at least help to offset expected burdens next year. “2024 will be a very challenging year economically,” said the manager. However, he wants to see the initial success of the initiatives that have been launched. “The goal is to manage the group stably so that we can get started from 2025.” VW preferred shares listed in the Dax fell by around 1 percent on average in the morning in a weak industry environment.
In the summer, Blume set new return targets for all of the group’s brands, which are to be achieved through savings and additional revenue opportunities.
Above all, the core brand VW Passenger Cars is the problem child in Lower Saxony. It is expected to generate a total of ten billion euros in earnings by 2026 and then increase the return on sales to 6.5 percent. In the first nine months of 2023 it was 3.4 percent. Brand boss Thomas Schäfer is currently negotiating with the works council on how this can be achieved. Blume made it clear that it would not work without staff cuts. “In order to increase our efficiency, it is also about reducing staff,” he said.
Blume did not want to specify exactly how many positions would be eliminated. “We use socially acceptable instruments such as the demographic curve or regulations for partial retirement.” The discussions went well and constructively. The employee side could imagine a works meeting on December 6th in Wolfsburg to present details, and there should be clarity at a VW management conference shortly before Christmas at the latest, the newspaper said.