WOLFSBURG (dpa-AFX) - Volkswagen has brought its own workforce to the barricades with its intensified austerity measures. At the works meeting in Wolfsburg, the Board of Management was greeted with loud protests. And while Group management defended its cost-cutting plans in front of 25,000 employees, works council chairwoman Daniela Cavallo announced fierce resistance. She will not accept plant closures, redundancies and wage cuts under any circumstances. "This is not possible with us."

Europe's largest car manufacturer had announced that, in view of the worsening situation, it would once again tighten its austerity measures at the core VW brand. Plant closures in Germany and compulsory redundancies are no longer ruled out. The job security agreement with the Works Council, which rules out redundancies until 2029, is to be terminated. For the first time in 30 years, there could then be redundancies at VW.

Crisis in the new car market

Volkswagen could be just the proverbial tip of the iceberg, experts fear. The entire German automotive industry is struggling with weak sales figures, particularly for e-cars, and is looking to the future with concern, according to the Ifo Institute. Things are currently not going well on the German car market. Sales of new cars slumped in August compared to the same month last year. This is mainly due to the recent weak demand for purely electric cars, according to figures from the German Federal Motor Transport Authority (KBA). However, the figures for almost all other drive types also fell, in some cases significantly.

According to the KBA, around 69 percent fewer electric cars were newly registered in August than in August of the previous year. For cars with diesel engines, the drop was 24.4 percent, for cars with petrol engines 7.4 percent. Across all drive types, the drop in the number of new registrations was 27.8%.

Car industry "in a nosedive"

According to the Ifo Institute, the outlook is also gloomy. Extremely pessimistic expectations caused the business climate in the industry surveyed by the Munich-based institute to plummet by 6.2 points to minus 24.7 points in August. Following a temporary slight recovery, this was the fourth decline in a row. "The mood in the automotive industry is in a nosedive," says Ifo expert Anita Wolfl.

Expectations for the next six months were particularly negative. "Companies in the German automotive industry are suffering from a lack of new orders - especially from abroad," said Wolfl. "This is now also being reflected in personnel planning."

E-cars hardly in demand

The KBA in Flensburg said that the current slump in the German new car market was also due to special effects from the previous year. Nevertheless, it should be noted: The situation on the new car market is extremely tense," said Constantin Gall from the consultancy EY about the figures. "We are a long way from a sustainable recovery, the gap to pre-crisis levels remains very large." In the year to date, almost 590,000 fewer new cars have been sold in Germany than in the same period in 2019, i.e. before the coronavirus pandemic.

In view of the low number of new electric car registrations, EY pointed out that an unusually high number of such vehicles were registered in August 2023. At that time, last-minute purchases by commercial customers were still driving up new electric registrations - before the state requirement for companies expired on September 1, 2023.

Rolling back the claim?

The German government is now planning state support again to boost sales of electric cars. Specifically, this involves stronger tax incentives for e-cars as company cars. Demand for e-cars collapsed after the government stopped offering them. The German government abruptly ended the so-called environmental bonus in December. The reason for this was budgetary constraints.

In July, the traffic light coalition agreed on a "growth initiative" as part of the budget negotiations. One of the measures is the tax incentive for e-cars as company cars. Accordingly, a special depreciation allowance for newly registered all-electric and comparable zero-emission vehicles is to be introduced for companies with retroactive effect from July 1, 2024. In addition, the so-called cap on the gross list price for company car taxation for e-vehicles is to be raised from 70,000 euros to 95,000 euros.

Lack of sales for two plants

However, this alone is unlikely to be enough to keep all plants running at full capacity. At the works meeting, CFO Arno Antlitz referred to general overcapacity, not just for e-cars. In Europe, two million fewer cars are currently being sold each year than before the coronavirus pandemic. And this is unlikely to change. For VW, with a market share of around a quarter in Europe, this means: "We are missing the sales of around 500,000 cars, the sales for around two plants. And that has nothing to do with our products or poor sales performance. The market is simply no longer there."/fjo/DP/nas