Volkswagen CEO: Cost-Cutting at Emden Factory Must Continue Amid Competition
Volkswagen's Emden Plant Faces Pressure to Reduce Costs
By Rachel More
CEO Oliver Blume Addresses Workers on Cost Challenges
BERLIN, Aug 26 (Reuters) - Volkswagen CEO Oliver Blume urged workers at the German automaker's Emden plant, which could face closure under a sweeping turnaround plan, to step up savings efforts, warning that costs were still too high when compared with rivals.
Comparisons with European Rivals
"This journey is not over. Because we not only measure ourselves against our own past performance. We measure ourselves against the best locations in Europe," Blume told staff, according to excerpts of his speech shared by the company on Wednesday.
Labor and Factory Cost Disparities
"Labor costs today are more than double those of comparable European locations. And when it comes to factory costs, other plants are still significantly cheaper. This is not a criticism — it is the reality against which we must measure ourselves," Blume said.
Future Uncertainty for Emden and Other Plants
Emden, an electric vehicle plant in Volkswagen's home state of Lower Saxony, is one of four factories that currently lacks a business plan beyond 2030.
Blume's Tour to Reassure Workers
Blume, who is touring Volkswagen sites this week in a bid to reassure workers and build support for broad cost-cutting measures, has described plant closures as a costly last resort.
Commitment to Jobs and Industrial Prospects
The CEO told workers that Volkswagen's responsibility would not end if it failed to secure the plant's future.
"We will fight for industrial prospects and jobs at our locations, with partners, with investors, and with new industrial solutions," he said.
(Reporting by Rachel More. Editing by Matthias Williams and Mark Potter)