Volkswagen, the German automobile giant, has recently announced that it needs to reduce part of its staff so that the company remains competitive, and especially in the electric car market.
Almost all Western automotive companies are in a similar situation. They run out of the bonanza from combustion cars with which they continue to earn a lot of money (they have all their investments amortized), and the electric car appears that has fewer components and requires 30% less work to manufacture.
And the conclusion is obvious, they have excess staff to manufacture the same number of cars, but with the additional problem of competition from Chinese cars that are cheaper and with better quality every day.
The personnel reductions at Volkswagen will focus on the areas of production, engineering and development. The company's management says it needs to be more efficient to compete in the rapidly growing electric car market.
The Volkswagen Group is one of the world's leading car manufacturers, but has struggled to adapt to the electric mobility transition. The company has launched a series of electric cars, but their prices are still higher than those of its competitors.
The workforce reductions are an important step for Volkswagen, but they may not be enough for the company to be competitive in the electric car market. The company also needs to reduce its production costs and develop more affordable electric cars.
The staff reductions will have a significant impact on Volkswagen workers. The company has a workforce of approximately 670,000 employees worldwide. The personnel reductions will affect employees in all regions, and how this will be done remains to be defined.
Most of the large Western automobile groups have made the same mistake. So far they have made a lot of money from fossil fuel cars, and have become complacent, allowing the Chinese to lead the market in electric cars and their batteries.
Today, the situation is what it is, and it is not going to improve. And as almost always, the “harmed” are going to be the workers. I have not seen the dismissal of any high-level directors announced. And today the company has a difficult road ahead.
Volkswagen's workforce reductions are a major decision that will have a significant impact on the company. The company needs to be more efficient to compete in the electric car market. However, staff reductions alone are not enough. The company also needs to reduce its production costs and develop more affordable electric cars.
Time will tell us how it evolves.
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