Chemnitz, Sept. 14, (dpa/GNA) - With demand for fully electric vehicles sagging, German auto giant Volkswagen has warned of potential job cuts at its Zwickau plant in eastern Germany.
VW workers at the plant employed on fixed-term contracts may not be renewed, according to information obtained by dpa. The cuts could initially affect a few hundred workers at the end of October out of the roughly 10,700 employed at the plant.
More than 2,000 people at the plant are working on fixed-term contracts.
Labour representatives plan to meet with VW management on Thursday.
For weeks now, uncertainty has been growing at the electric car factory in the face of sluggish demand. Many employees are concerned.
Shop stewards with the German industrial labour union IG Metall wrote a letter to VW management about the situation.
“Enough is enough! We finally want answers,” the labour leaders wrote to the company, according to quotes published in the Freie Presse newspaper.
Questions are being raised as to why the electric cars are not being better advertised and whether the plant will continue to run on three shifts.
Over the past few years, VW has converted its plant in Zwickau into a purely electric vehicle factory at a cost of €1.2 billion ($1.3 billion). The last combustion engine vehicle rolled off the plant’s production line in 2020.
In addition to VW’s ID models, the plant also produces electric models from VW brands Audi and Cupra.
Last year, according to earlier figures, 218,000 electric cars were built at the factory. Production was scheduled to increase this year to 360,000 vehicles at full capacity – but there could now be a reduction in shifts instead.
“It is a serious situation,” said Martin Dulig, the economics minister for the German state of Saxony, where Zwickau is located.
Dulig said he has been in touch with labour representatives from the plant as well as his counterpart in VW’s home state of Lower Saxony, Olaf Lies, for several weeks.
Dulig acknowledged that VW is currently facing sales problems and said new initiatives are needed to get potential buyers to consider German vehicles. One possibility, Dulig said, is a scheme for companies in Saxony to lease VW cars.
But he also called on VW to find new ways to improve sales.
Potential car buyers have become more reluctant to buy electric vehicles, which are usually significantly more expensive than combustion engine models, given high inflation and declining government subsidies in Germany.
Industry experts expect the new vehicle market share for electric cars in Germany to decline sharply in the coming year.
German government subsidies for companies that bought electric vehicles expired on September 1. Similar subsidies for private buyers are set to shrink from €6,750 to €4,500 at the end of the year.
In addition, German auto manufacturers are facing growing competition from Tesla as well as Chinese electric vehicle makers, including BYD.
GNA