Photography: Volkswagen
Volkswagen’s difficulties are worsening in the electric sector. The famous Zwickau factory, Volkswagen’s largest electric car production site in Europe, is about to lay off workers. The demand is not there.
Job cuts in Zwickau?
According to the German media Automobile Week, the German car manufacturer plans to organize a staff meeting this Thursday, September 14, 2023. Job cuts are to be announced. The reason is simple: rising inflation and falling subsidies weaken demand. Volkswagen cannot sell enough electric vehicles. Already at the beginning of summer 2023, the brand had reduced production of certain electric models due to insufficient demand.
At the time, it was the Emden site in Germany that was concerned. The drop in production particularly concerned the ID.4, “ whose sales were 30% lower than initially planned production figures “. Nearly 1,500 temporary jobs had not been maintained. The Volkswagen Zwickau factory produced its latest thermal model in 2020. The site has always been considered a real spearhead of the German group’s new industrial strategy.
Today, the factory is entirely dedicated to the production of electric vehicles. All based on the MEB platform, namely: ID.3, ID.4 and ID.5. Other models like the Audi Q4 e-tron and the Cupra Born are also manufactured there. At the time of the site’s transition to 100% electric, Reinhard de Vries, technical director at Volkswagen, said to himself: proud of what we have achieved so far, but we are also excited to see what the future holds ».
The ” situation is serious » for the Minister-President of Saxony
The Minister President of Saxony, Michael Kretschmer, declared that “ In the next few days, maybe even the next few hours, we will hear some unfortunate news. We were proud of what is happening at Volkswagen with electromobility, but ultimately it will not be successful “. He even revealed before the car manufacturer that several workers at the factory “ will no longer be able to work there, at least temporarily ».
Several hundred workers, out of the 11,000 who work on the site, could be affected as early as October. This figure will be confirmed at the meeting organized by Volkswagen. More generally, Michael Kretschmer expressed his concerns, estimating that the “ situation is serious “. Over the months, the situation has worsened for the German group in the electric segment. A sharp drop in demand has been recorded and the outlook is rather bleak.
This news resonates with the European Commission’s recent announcement about the opening of an investigation into subsidies granted to Chinese electric vehicles. Ursula Von der Leyen says to herself “ open to competition ”, but not at any price. Chinese manufacturers of electric vehicles like BYD, Nio or Xpeng want to flood the European market with models at attractive prices. Unfair competition according to the European Union.
The announced death of the Volkswagen ID range?
Volkswagen spent 1.2 billion euros in 2018 to convert its factory to 100% electric production. It took 26 months for the German company to successfully complete this transition in very good conditions. Volkswagen wanted to take its time to retain jobs and train its workers on the new models. Since 2020 and the transformation of the Zwickau factory, many competitors have developed in Europe in the electric segment.
Tesla has made a spectacular breakthrough in just a few years and Volkswagen is now paying the consequences. Its electric models are struggling to seduce. The German group is looking for solutions and the ID range is perhaps at a turning point in its history (however recent it may be). Volkswagen is exploring several avenues and one of them would be to “ completely review the design of its electric vehicles ».
According to Andreas Mindt, head of design at Volkswagen, “ the ID.3, ID.4, ID.5 and ID.7 models have been designed to bring new life to the brand. But the reality is that it doesn’t work “. Very futuristic, these models have almost nothing to do with the traditional Golf, Passat or Tiguan of the German giant. In the future, the brand’s electric vehicles will certainly look more like the flagship models of the 80s or 90s than the ID range.
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