Wednesday 20th October 2021
VW boss Diess has “no plan”
Wolfsburg is threatened with weakest production since 1958
The semiconductor crisis is leaving deep marks on the brakes on Volkswagen. In order to achieve one’s own goals, “a miracle must happen,” says an insider. Works council boss Cavallo criticizes the crisis management of the group management. It is overwhelmed with the current situation.
Volkswagen is coming under massive pressure because of the production interruptions caused by the lack of chips at its main plant in Wolfsburg. In the first nine months of the world’s largest automobile factory of the main brand VW just a little more than 300,000 vehicles rolled off the production lines, said an insider from the Reuters news agency. Volkswagen did not want to comment on it. “Die Zeit” reported on it first. Accordingly, Volkswagen threatens to build as few cars at the main plant in Wolfsburg this year as it did in 1958.
“It would have to be a miracle if we were to reach the previous year’s level by the end of the year,” the weekly newspaper quoted an insider as saying. Last year, for the first time in over 60 years, less than half a million Golf, Tiguan, Touran and Tarraco cars were built in Wolfsburg. In 2021 the number could be less than 400,000. According to the newspaper, the group only generally confirmed the decline, the shortage of semiconductors had “led to a high number of non-produced vehicles”.
The works council chairman Daniela Cavallo accused the management around CEO Herbert Diess of lack of concept, it seemed overwhelmed in the current situation: “We cannot yet see a plan from the company management how this crisis can be managed,” she told the newspaper.
Wolfsburg productivity under fire
The “future pact” agreed by the works council and company management at the end of 2016 stipulated that Wolfsburg should build at least 820,000 vehicles in 2020. In mid-2018, VW was still assuming a production volume of around one million vehicles. The factory reached its previous production record during the Beetle era in 1964 with almost 960,000 vehicles.
The weak utilization of the main plant has repeatedly caused disputes between the works council and management. Most recently, CEO Diess had annoyed the employee representatives with statements about possible job cuts. According to insiders, he warned the supervisory board of the scenario of cutting up to 30,000 jobs in Germany at the end of September. The works council then went to the barricades. VW then made it clear that there were no plans to cut jobs on the scale mentioned.
The Group’s parent plant has long been criticized for its low productivity. Several CEOs have complained about this, but have avoided a dispute because of the strong position of IG Metall and the state of Lower Saxony. Diess and VW brand boss Ralf Brandstätter now want to modernize the Wolfsburg plant. They have declared the factory that Tesla is currently building in Brandenburg to be the model for the traditional plant.