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Sales of the global automobile market shrank as a result of the epidemic, and the sales performance of a number of car companies declined last year, superimposed on the electrification revolution of car companies, and the capital chain became needed by all major car companies. In order to start a new round of cost-cutting plans, foreign media reported that Volkswagen plans to cut as many as 4000 jobs in Germany.

The company has worked out a plan with the employees' committee to open partial retirement to people born in 1964 and to provide early retirement options for employees born between 1956 and 1960, according to a statement from Volkswagen Group.

Volkswagen said that at present, the number of people who feel to retire early is as high as 900, but the number of people who choose to retire is not large, and the public has not provided a specific plan. However, according to insiders, Volkswagen will cut about 3000 to 4000 workers at its six German factories through this plan, bringing the company's total to about 120000. The German business newspaper reported on Sunday that Volkswagen will cut up to 5000 jobs.

Early retirement means that the group will also be responsible for the income of these employees until their formal retirement, and a source estimates that Volkswagen has prepared 500 million euros to cover benefits related to early retirement. despite the expected layoffs, the layoffs are expected to save the group billions of euros.

It is understood that the layoff plan of the group is to prepare for the transformation of electric vehicles in order to save more money. The German business newspaper also reported that Volkswagen is also considering hiring new people this year, which can only be recruited externally in areas such as electric vehicles, digital and battery development. In January, Volkswagen said it would cut management fees by 5 per cent and procurement costs by 7 per cent over the next two years.

Another reason for cost savings is that the group's profits fell sharply last year. Affected by the epidemic, Volkswagen's 2020 financial report showed that the group made an after-tax profit of 8.82 billion euros (about 68.933 billion yuan) last year, down nearly 40% from the previous year.

The reason for the halving of revenue and profit is still due to a marked decline in Volkswagen sales. According to the financial report, Volkswagen Group sold 9.2 million new cars worldwide in 2020, down 16.4 percent from the same period last year, while operating revenue from automobiles was 222.9 billion euros, down 11.8 percent from the same period last year. As a result, Volkswagen had its worst sales performance in nearly a decade, ranking second behind Toyota for the whole year.

Still, Volkswagen is pouring money into the electric sector in an attempt to catch up with electric carmaker Tesla and regain its market position. Volkswagen CEO Dis even shouted on social media about Tesla and Musk, saying they would "snatch" part of the competitor's market share.

Volkswagen will invest about 16 billion euros by 2025 to cater to future trends such as electric cars, hybrids and digitalization. In 2021, Volkswagen plans to launch the crossover model ID.4 and add more versions of Audi e-tron and Porsche Taycan models to enrich the lineup of new energy products. Although pure electric cars accounted for a small proportion of sales last year, sales have increased by 214 per cent, from 73700 to 232000, laying the strategic foundation for Volkswagen's transformation.

It can be seen that Volkswagen has been able to save and realize its transformation in order to promote the transformation of electrification. Volkswagen has previously said that the group will only retain Volkswagen (including Skoda, Seattle), Audi, Porsche and other brands. other brands are likely to be sold or cut off. At the same time, it was rumored earlier this year that it was considering listing its ultra-luxury brand Porsche independently to raise the funds needed for the group's transformation to electrification and digitization. You can see the public's determination to change.

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