News: 4-day week not necessary, says Volkswagen

Compensation & Benefits

4-day week not necessary, says Volkswagen

The automaker said over the weekend that its existing cost control measures are sufficient and that further cuts to jobs or even working hours are not necessary.
4-day week not necessary, says Volkswagen

German automaker Volkswagen has said it does not need to implement a four-day work week to save jobs, even though Germany's largest trade union had last month proposed adopting a four-day week across industries in order to help companies control labor costs and retain jobs.

Over the weekend, Bernd Osterloh, chairman of the Volkswagen works council—the body that handles discussions and negotiations between employee representatives and management—was reported as saying that the automaker's existing cost control measures were sufficient to see it through the COVID-19 crisis despite plunging car sales. Volkswagen, like most of its contemporaries, is currently making the transition to electric cars and more highly automated production lines, which reduce the need for manpower.

However, Osterloh said that production levels for some of the automaker's most popular models continued to be high, and there is no shortage of work. He even projected that Volkswagen might overtake Tesla in production by 2023. "At the moment we are not talking about less work," he said. "With the [Volkswagen Golf] we had the [production] levels of last year in June and July and introduced extra shifts. The four-day week is not an issue for us."

While reduced working hours have been touted as an effective way of reducing costs and saving jobs, the applicability of the measure is subjective, depending on how much work a company, or even an individual department within a company, has.

Volkswagen's current cost control measures are directed by its Future Pact program, which was rolled out in 2016. Under the program, the automaker has been shedding jobs since before the pandemic began: last year, it announced that it would be cutting up to 7,000 jobs by 2023. In July this year, Osterloh told analysts and investors that the program was sufficiently effective that incremental cost cuts—specifically structural cost programs such as mass layoffs—are not presently needed.

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Topics: Compensation & Benefits

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