VW to turn two German sites into electric vehicle plants

World’s biggest carmaker under pressure from EU emissions regulations

The decision has the support of  VW’s powerful labour unions. Photograph: Reuters

The decision has the support of VW’s powerful labour unions. Photograph: Reuters

 

Volkswagen said on Wednesday it is transforming two of its German production sites into electric vehicle plants, ensuring that by 2022 it will boast “the largest network for the production of electric vehicles in Europe”.

The world’s biggest carmaker, under pressure from EU regulations demanding steep cuts to fleet emissions over the next 12 years, confirmed details already leaked to the media indicating that its sites in Emden and Hanover would now be part of its “electric offensive.”

“We are orienting the company towards clean mobility,” said chief executive Herbert Diess.

The decision still needs to be ratified by VW’s supervisory board, but it already has the blessing of VW’s powerful labour unions.

Manfred Wulff, the works council chairman for Emden, said: “The automotive industry and Volkswagen are undergoing the greatest transformation in their history and the Emden plant is at the forefront.”

Gunnar Kilian, VW’s top human resources official, said the agreement includes an “employment guarantee” up to 2028 for the two sites. The hope is that VW can reduce headcount through natural attrition.

Fewer production steps

“Fewer production steps are involved in making an electric vehicle, [so] we will need fewer employees in the final resort,” he said. “We have therefore agreed with the Works Councils that the current employment volume will be adapted in a socially compatible way along the demographic curve via the attractive partial early retirement scheme of Volkswagen.”

Before this decision, only VW’s plant in Zwickau, Saxony, was set to produce electric vehicles. It is home to the ID Neo, a long-range electric hatchback going on sale late next year.

VW did not confirm that the Emden plan will be home to an entry-level electric vehicle that will cost less than €20,000, though two people with knowledge of the plan said it is among the decisions the board will take on Friday.

It did say that the ID Buzz, an electric minibus, “will probably be produced” in Hanover from 2022 alongside combustion engine commercial vehicles.

A press conference after the board meeting on Friday afternoon is already scheduled. – Copyright The Financial Times Limited 2018