Volkswagen rescue plan 'short on specifics' after tense stakeholder talks

BERLIN: ​Volkswagen management had little to ​show on Friday from talks with the group's stakeholders, ​laying bare the difficulties in overhauling Germany's creaking auto giant at a time of existential challenges for the industry.

A meeting of the supervisory board ended on ‌Thursday night without ⁠any ⁠mention from the company on the job cuts or plant closures that sources close to the matter said CEO Oliver Blume would put to the committee.

Instead, ​Volkswagen repeated largely known targets to reduce production capacity and gradually streamline its sprawling model line-up and investment portfolio - measures that do not ​require the blessing of the supervisory board.


Jefferies ⁠analysts said ‌there was "no indication of progress towards an agreement having ​been reached" ​on plant closures or job cuts of up ⁠to 100,000.

Bernstein analysts said the plan communicated by Volkswagen after ​the meeting was "long on ideals, but very ​short on specifics".

Shares in Volkswagen were indicated largely flat in pre-market trading. Volkswagen's supervisory board includes representatives of the owner families, unions and the Lower Saxony state government, a power-sharing structure that often complicates decision-making.

Volkswagen is under unprecedented pressure to restructure the business model that underpinned ‌its success for decades. The company is now contending with high costs and excess capacity at home, along ​with rising Chinese ​competition, regulation and ⁠U.S. import tariffs, which have combined to slice profit margins in half between 2021 and 2025.

"Everyone involved is fully aware that Volkswagen and ​the automotive industry as a whole are currently facing a critical situation, with an extremely challenging international competitive environment," Lower Saxony premier Olaf Lies said in a statement after the meeting, adding that the state was working with management to overcome the challenges.