German carmakers flood jobs market with managers after wielding axe
Sebastien Ash in Frankfurt
Volkswagen is axing hundreds of management roles as part of a cull of white-collar workers, flooding the job market at a time when Germany’s auto giants are under extreme pressure from Chinese carmakers.
Manufacturers such as Mercedes-Benz and Volkswagen were “squeezing out managers like mad”, said Magnus Tessner, automotive partner at the executive search company IFP.
Many of the managers were searching for new jobs, although their departures had been cushioned by generous exit packages, he said.
One external headhunter said that they had been approached by VW to find new positions for 400 to 500 managers. “I told them we cannot do it . . . we do not have 400 executive roles that need filling,” the recruiter said.
VW has already started reducing the number of factory workers in Germany, but has set out plans to cut another 50,000 jobs in “indirect” areas of the business such as administration, product development and sales.
Its sports car brand Porsche has also unveiled plans to shed 5,000 jobs, primarily in back-office roles.
VW’s initial programme to cut 50,000 jobs in Germany by 2030 affected employees in manufacturing and back-office roles across the VW brand, Audi and software unit Cariad.
But those plans did not go far enough, and an internal analysis found administrative costs were 30 per cent above the level of other manufacturers.
The difference was “largely driven by the complexity of the group structure across all levels”, chief financial officer Arno Antlitz said at the group’s second-quarter earnings.
Even if VW does ultimately cull 100,000 jobs — unlikely because of union opposition — the group would still employ about 580,000 people, well above Toyota’s 390,000 and the 335,000 employed by South Korea’s Hyundai.
At Porsche, the latest restructuring measures come in addition to an existing plan to reduce headcount by 3,900, including about 2,000 temporary workers employed in factories.
The new programme would largely spare blue-collar workers, Porsche chief executive Michael Leiters indicated on Wednesday.
Porsche had “experienced disproportionate growth in indirect areas, and also . . . where management positions were created”, Leiters said, and was now “intervening and making disproportionate reductions” in those areas.
Porsche was eliminating some departments and merging business areas, and had cut the number of board seats from eight to seven, he said.
Other German carmakers are also cutting white-collar jobs. BMW last week extended voluntary redundancy offers to thousands of workers in desk jobs, including development and product planning.
The Munich-based carmaker expected to shed 8,000 workers by the end of 2027 through the programme, which does not include factory workers, a person close to the company said.
BMW will reorganise management and merge organisational units as part of its restructuring effort, BMW chief executive Milan Nedeljkovic told workers.
