Relief at VW Chemnitz plant amid fears carmaker plans drastic cuts

As VW board members tour sites throughout Germany holding crisis talks with staff, state lawmakers expressed frustration about the outlook on Thursday.

"It is my clear expectation of the Executive Board that they will ensure a viable plan for the future," Lower Saxony's premier Olaf Lies told dpa. "Plant closures and mass redundancies cannot be the solution."

His comments come after VW boss Oliver Blume said he plans to expand cost-cutting measures, triggering fears at Europe's largest carmaker that tens of thousands of additional jobs and four entire sites could be at risk.

Blume's comments led to anger at the powerful works council, and a slew of extraordinary staff meetings at nine sites.

VW's management board began a tour of its sites on Tuesday. After visits to the plants in Emden and Zwickau - considered to be at risk - the board representatives headwed for the engine plant in Chemnitz and a plant in Dresden. However, the Dresden talks were called off as no urgent talks were needed there, works council spokesman Heiko Lossie said.

VW has not been producing cars in Dresden since the end of last year. After 24 years of series production, the last car rolled off the production line in December and now, an innovation campus is being developed together with Dresden University of Technology and 230 workers are to keep their jobs for the time being.

The staff meeting with VW board member Thomas Schmall gave a positive signal to the Chemnitz engine plant. Financial figures, production figures and capacity use in Chemnitz are excellent, and the order books are full, said Christian Sommer, VW Saxony spokesman said after the meeting.

Works council chairman Olaf Glöckner also described the mood following Schmall's visit as positive.

Beyond Emden and Zwickau, there are no viable plans for the commercial vehicle plant in Hanover and the Audi site in Neckarsulm for the 2030s.

"However, I would also like to make it clear that no decision has been made regarding possible plant closures," said Blume. The aim is to create robust prospects for all sites over the next six to twelve months.

He has recently underlined that the problems facing the carmaker are not internal VW problems. "The entire car industry is under enormous pressure," he said, pointing to US tariffs, market developments in China and several political crises as factors affecting all major manufacturers and suppliers alike.

Industry observer Stefan Bratzel from the Centre of Automotive Management said Volkswagen must achieve a "quantum leap" as it looks to the future.