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| Audi is to shed jobs as it shifts to electric models (AFP Photo/CHRISTOF STACHE) |
Frankfurt am Main (AFP) - German luxury carmaker Audi said Tuesday it planned to slash 9,500 jobs in Germany by 2025 as part of a massive overhaul to help finance a costly switch to electric vehicles.
The job
cuts will be achieved through an early retirement programme and natural
turnover at its two German plants, the company said in a statement.
At the same
time, the Volkswagen subsidiary said it would create 2,000 new jobs in the
areas of electromobility and digitisation as it pivots to the smarter, cleaner
cars of tomorrow.
The
shake-up comes as Audi, like other carmakers, grapples with slowing demand in a
weaker global economy, tougher pollution rules and the huge investments needed
for the battery-powered era.
"In
times of upheaval, we are making Audi more agile and more efficient," said
CEO Bram Schot.
"This
will increase productivity and sustainably strengthen the competitiveness of
our German plants."
The
remaining roughly 50,000 workers at Audi's Ingolstadt and Neckarsulm factories
will have job security until the end of 2029 under the hard-fought deal struck
with labour representatives.
"We
have reached an important milestone," said Peter Mosch, head of Audi's
works council.
"The
extension of the employment guarantee is a great success in difficult
times."
Audi said
the reorganisation would help boost earnings by six billion euros ($6.6
billion) by 2029, keeping the premium brand on track to reach a profit margin
of nine to 11 percent.
New CEO
The jobs
cull comes after Audi was hit by falling sales, revenues and operating profits
over the first nine months of 2019.
But the
company is far from alone in feeling the pain from an industry in the throes of
transformation and buffeted by the knock-on effects from US-China trade
tensions and Brexit uncertainty.
German car
parts suppliers Bosch and Continental have themselves announced thousands of
job cuts to slash costs, while Mercedes-Benz maker Daimler is reportedly
planning to axe 1,100 managerial roles.
Hoping to
turn the tide at Audi, the Volkswagen group earlier this month said it had
picked former BMW purchasing chief Markus Duesmann to replace Schot as the
brand's chief executive from April.
Under
Schot, Audi suffered more than other German manufacturers from the introduction
last year of strict new emissions testing standards in the European Union,
which led to expensive production bottlenecks.
And like
its rivals, Audi is spending billions on new technologies, including
battery-electric and hybrid vehicles, connectivity and autonomous driving.
But the
firm last year also had to pay an 800-million-euro fine over its role in the
"dieselgate" scandal.
The saga
erupted in 2015 when the Volkswagen group admitted to installing cheating
devices in 11 million diesel cars worldwide to dupe regulatory emissions tests.
Audi's
engineers are suspected of having helped developed the software used to make
cars emit less pollutants under lab testing conditions than on the road.
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