Both Volkswagen and its employees have been facing difficulties. The vast staff of Volkswagen has been uneasy since the corporation revealed plans to close some of its plants earlier this month. Additionally, the massive company with its headquarters in Wolfsburg has backtracked on its previous promise of job security, leaving many employees in fear of losing their employment in the near future.
The effect won't be negligible. As Volkswagen considers closing two or three facilities in the upcoming months, over 15,000 workers may lose their jobs, according to a note from Jefferies analysts on Monday. Of the 200,000 workers at the Volkswagen brand, about 120,000 are situated in Germany.
Specifically in Wolfsberg, labour representatives occupy half of the supervisory board seats, which could tip decisions in favour of the union.
The supervisory board may not need to approve Volkswagen's factory closures, according to the analysts, which may result in up to €4 billion in closure expenses being provided, as Jefferies said in its report.
Analysts stated that the rationale to re-size Volkswagen's namesake is not new but management’s sense of urgency and determination to tackle excess capacity and spending patterns both are. Further,"there is risk of plant disruption, but unions can only strike on pay, not plant closure or layoffs if the latter are not contractually protected.”
