Thursday, November 23, 2006

Golf production in Brussels plant ends

Source: Volkswagen AG
BRUSSELS - Volkswagen plans to restructure the Brussels location, reflecting excess capacity in Western Europe. The management of Volkswagen Brussels started talks on Tuesday with the employee representatives on a corresponding concept, under which the Golf will no longer be manufactured at three plants in Western Europe in the future, but at two – Mosel and Wolfsburg.

The Western European automotive market is largely saturated and is struggling with excess capacity. Volkswagen’s Western European plants are not running at full capacity, despite a rise in market share. Export opportunities, too, cannot be expanded significantly due to the US dollar exchange rates and high import duties in growth markets, among other factors. The growth markets of the future are above all Russia, India and China.

Press release continues...

Volkswagen has therefore initiated a far-reaching restructuring at its German locations. The core element is a reduction by up to 20,000 jobs in Germany, much of which has already been implemented. Additional optimization measures in Germany are planned.

Following these cuts in Germany, other locations must now be incorporated into the restructuring program so as to ensure competitive production and capacity utilization at the Volkswagen plants in Western Europe as a whole. That is why production capacity must be aligned with the current operating environment. Talks have begun with the employee representatives on a concept to structure capacity at the plant, and all economic alternatives will be reviewed so as to keep as many jobs as possible in Brussels.

The Administrative Board emphasized that Volkswagen intended to stay at the Brussels location and urged all involved to provide it with constructive support in the light of the difficult environment. The company is aware of its responsibility for all employees in Brussels and will develop a socially responsible settlement together with all stakeholders.

The management of Volkswagen Brussels announced that it was holding more in-depth talks with the employee representatives with immediate effect.

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