Volkswagen (VW) is to cut its workforce by 30,000 over the next five years as it acts to save costs following the diesel emissions scandal.
The German carmaker said it was committed to no compulsory redundancies under the union deal, with 23,000 of the positions to go at factories in its home market and the rest in North America and Brazil.
VW said the job losses were “socially acceptable” as it prepared to relaunch the brand by 2020 – tainted by the rollout of software in 11 million diesel vehicles that was designed to cheat emission testing.
At a news conference at the firm’s Wolfsburg headquarters, VW brand chief Herbert Diess said: “I am very sorry for those affected, but the situation of the brand at the moment gives us little room for manoeuvre.”
It has already set aside €18bn (£15.4bn) to cover costs associated with ‘dieselgate’ – the bulk of them in the US where the company has agreed a massive $15bn (£12.3bn) compensation and vehicle buy-back package.
It has pledged to fix all vehicles affected in Europe, including 1.2 million in the UK, by this time next year.
VW said its future plan would focus on new electric car technology – paid for through annual savings of €3.7bn (£3.2bn).
The bulk of the job losses would be achieved, VW said, through not replacing retirees or those leaving for new positions elsewhere.
The company added that it was creating 9,000 new positions through its focus on new technology which aimed to deliver 30 electric models by 2025.
It hopes the marked shift from traditional fuel-powered vehicles will help steal a march on rivals amid continued debate over the use of diesel – once hailed as the greener alternative to unleaded but now linked to thousands of deaths across the EU each year.
The emissions crisis hit VW sales – 10% down in the UK alone in the 12 months after it emerged – with the company reporting its first financial loss in over two decades last year.