Volkswagen said that it would open talks with labor unions to come up with a cutting costs strategy as soon as possible, as the automaker is facing pressure to recoup some of the losses triggered by the dieselgate.
After Volkswagen reported its highest ever operating loss last year, as it set aside 16.2 billion euros (18.4 billion dollars) to cope with the financial repercussions of the emissions scandal, the company committed to streamline its operations to reverse the downward trend. Next week it will present a new business plan along these lines, a strategy that will also be focused on more technological investments in electric cars, self-driving systems and mobility services.
The automaker has also started negotiations between workers’ representatives and top management on how to increase profitability without shaving off jobs at German plants. “During the first discussions, both sides reached a common understanding of the initial situation and the challenges resulting from both the diesel issue and the introduction of e-mobility and digitalization,” VW said in statement, adding the talks should be concluded by autumn.
Despite the diesel scandal, Europe’s biggest carmaker agreed last month on a pay raise for around 120,000 workers at the carmaker’s western German plants, following long time negotiations with the country’s biggest labor union, IG Metall. In the first quarter of the year, VW’s operating profit of its main marque crushed to 73 million euros (81 million dollars) from 514 million euros last year, with an operating margin of 0.3 percent, way behind the 6 percent mid-term goal.