Azernews.Az

By Alimat Aliyeva

About 20,000 employees of the German carmaker Volkswagen (VW) have already agreed to early dismissal, Azernews reports.

According to reports, about two-thirds of them will retire. As the newspaper notes, the automaker is making progress in implementing its cost-cutting measures.

After difficult negotiations, the VW board of directors and the industrial trade union IG Metall, which represents the employees, reached an agreement at the end of last year on a cost-cutting program for the main Volkswagen brand. The plan includes reducing a total of 35,000 jobs by 2030, primarily at the company’s plants in Germany. The layoffs are intended to be carried out in a socially responsible manner, with affected employees consenting to the terms.

Employees will receive severance pay based on their length of service, which can amount to as much as 400,000 euros. In addition to job cuts, starting in 2026 Volkswagen will reduce the number of internship positions offered annually from 1,400 to 600. These measures are expected to save the company approximately 1.5 billion euros annually in labor costs.

Furthermore, about 130,000 VW employees have agreed to a salary freeze. Instead of a planned 5% wage increase, the funds will be redirected to a special fund designed to finance initiatives such as flexible working hours. At the same time, the increased vacation allowance payment has been canceled.

According to IG Metall, these measures have helped prevent the closure of VW plants. However, given the ongoing challenges faced by German automakers, some experts, including the publication Bild, remain skeptical about the long-term effectiveness of these promises.

Volkswagen is simultaneously investing heavily in electric vehicle (EV) technology and autonomous driving, aiming to transform its business model. This transition to sustainable mobility could potentially create new jobs in emerging fields, even as traditional manufacturing roles decline.