Volkswagen Plans Over 4,000 Further Job Cuts at Porsche Amid Restructuring
Volkswagen's Restructuring and Impact on Porsche
Overview of Job Cuts
BERLIN, Sept 19 (Reuters) - Volkswagen's sweeping turnaround plan foresees more than 4,000 further job cuts at Porsche, German business daily Handelsblatt reported on Saturday, following a profit warning linked to problems at the sports car subsidiary.
Details of the Agreement
Files documenting a recent agreement by Volkswagen's supervisory board to usher in the German auto group's largest restructuring yet propose a reduction of "about 4,100 employees" at the brand, addressing an overhead shortfall of some €700 million ($803.8 million), according to Handelsblatt.
The newspaper said the cuts would be "in addition to existing agreements".
Previous Layoff Agreements
In July, Porsche management and labour representatives agreed to an additional 5,000 layoffs on top of 4,000 determined earlier, bringing the scope of currently agreed job cuts at the Stuttgart-based 911 maker to around one in five by 2035.
Reactions and Company Statements
Volkswagen declined to comment. A Porsche spokesperson declined to comment on the reported plans of Volkswagen's supervisory board.
The parent company can only recommend, but not mandate, such measures at Porsche.
Financial Implications
Volkswagen on Friday revised down its full-year margin target, now hoping for 1% at best rather than a previous range of 4.0-5.5%.
Reasons for Margin Revision
The revision was due in large part to a writedown at Porsche, where CEO Michael Leiters is under pressure to deliver a comeback strategy following a collapse in China sales and a costly reversal of the carmaker's EV strategy.
($1 = 0.8709 euros)
Reporting Credits
(Reporting by Rachel More; Editing by Jan Harvey)
