Volkswagen cuts jobs in China amid fierce local competition
China, Volkswagen's largest market, is increasingly turning towards its own products, forcing the German company to make difficult decisions.
10:02 AM EDT, September 23, 2024
According to Bloomberg, the Volkswagen Group has begun reducing jobs in China as part of a new cost-cutting strategy. The German conglomerate aims to reduce expenses by an average of 20 percent before 2027.
Anonymous sources indicate that the cuts will affect several hundred local employees at both Volkswagen and Audi. Company representatives did not share details. In a statement sent to Bloomberg, the company mentioned "optimization actions, which may also include direct and indirect personnel costs."
In the first half of 2024, Volkswagen's sales in China decreased by 7.4 percent, mainly due to increasing competition from local companies. The German brand had consistently led the Chinese market for over 15 years. However, in 2023, it was surpassed by BYD.
Last week, Bloomberg also reported on the possible closure of one of VW SAIC's Chinese factories due to weakening demand. Final decisions have not yet been made. However, it is becoming increasingly clear that Europe will not be Volkswagen's only concern.
