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VW reviews investments as change is not 'painless'

Volkswagen's new CEO Matthias Mueller has told a meeting of VW employees that efforts to overcome the emissions crisis at the German carmaker would not be painless. He also announced a review of all planned investments.

Volkswagen has been struggling to repair the damage caused by its diesel emissions scandal, the biggest crisis facing the company in its 78-year history.

The revelations about the carmaker's large-scale cheating of its emissions tests have so far wiped out a third of the firm's value, and caused a significant damage to its image worldwide. Moreover, VW may face fines running into billions of euros.

At a meeting with staff on Tuesday, Mueller warned that changes at the company would not be "painless," in a sign that there could be job cuts in response to the diesel emissions testing scandal.

"Technical solutions to the problems are within view. However, the business and financial consequences are not yet clear," Mueller said, according to a statement released by Volkswagen.

"Therefore we are putting all planned investments under review. What is not urgently needed will be scrapped or delayed," Mueller added. "And therefore we will adjust our efficiency program. I will be very open: this won't be painless."

'No consequences for jobs'

However, Bernd Osterloh, the head of VW's works council, had earlier struck a slightly different tone stating that there won't be any job cuts at VW.

"The good news at the moment is that there are no consequences for jobs," he told a meeting of more than 20,000 workers at the carmaker's sprawling central operations in the northern German city of Wolfsburg.

"And we will do everything to secure employment," said Osterloh, who represents the group's workforce on the company's supervisory board.

"Together we will convince the financial markets of Volkswagen's strength," Osterloh said, calling for workers and management to rally together to overcome the crisis.

He also noted that they would pay close attention to the management board's bonuses and said workers would not "foot the bill for wrongdoings of a group of managers."

Volkswagen's 20-member supervisory board is due to meet on Wednesday to take stock of the current situation. It is also expected to announce the appointment of VW finance chief Dieter Poetsch as the group's new board chairman.

sri/uhe (Reuters, dpa)

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