IMF NewsBriefs No. 12/2005 – VW Plans………

VW PLANS TO AXE JOBS

In an effort to cut costs, Volkswagen announced that jobs in Europe may go, but will honour the agreement that exists at six of its German plants on no dismissals until 2011.

GERMANY: Volkswagen (VW) announced that it might cut jobs at its European plants over the next three years as part of several cost-cutting measures it is considering. The VW workforce based in Wolfsburg was informed by management about the company’s plans at a workplace meeting held on September 5. However, management did not confirm the number of jobs that may go, quoted as being up to 14,000 in some press reports.

VW said it would not break the terms of the collective agreement it struck last year with IG Metall, which guarantees job security for 103,000 workers at six of its plants in Western Germany until 2011. Instead, the world’s fourth-largest carmaker will achieve the cuts by offering voluntary redundancies, early retirements, and part-time jobs to older workers.

VW employs 340,000 workers worldwide. [September 07, 2005]