Volkswagen is aiming to reduce expenses by €10 billion through cutting administrative costs

this will be accomplished through early and partial retirement rather than layoffs.

The goal is part of VW's effort to reduce expenses at the VW brand by 10 billion euros by 2026. VW had earlier issued a warning that its passenger cars were becoming less competitive due to high costs and low productivity.

Similar to other automakers, Volkswagen has experienced high labour and energy costs in Germany, intense competition from Asia, and inflation. As a result, it has had to make significant cost reductions in order to stay ahead of its competitors, which now include Tesla.

According to the memo, additional measures include slashing overall production times, cutting product cycles from 50 months to three years, and abandoning a proposed new 800-million-euro R&D site in Wolfsburg.

Oliver Blume, the CEO of Volkswagen, aims to increase the company's speed and efficiency. In addition to the VW brand, the company also owns a majority stake in Porsche, the Audi, and Lamborghini brands.

Falling production at Volkswagen's main factory in Wolfsburg, where Daniela Cavallo, head of the works council, stated that output was still far below the historical average, is a reflection of the industry's current struggles.

(Sources: investing.com, reuters.com)