Audi to cut 15 percent of workforce

Audi has confirmed that it will cut up to 9,500 jobs at its German production facilities in the next five years.

The decision, officially announced today, is claimed to free up €6 billion (£5.14bn) for investment in the company's burgeoning electric vehicle (EV) product offensive and digital technologies.

Audi employs around 62,000 workers in its home country, and the job cuts mean that around 15 percent of its workforce will be gone by 2025. However, it will extend its employment guarantee for its “core workforce” until 2029, and also claims profit-sharing between workers will continue. Audi will also recruit for new jobs.

 “The company must become lean and fit for the future, which means that some job profiles will no longer be needed and new ones will be created. That is why Audi is investing systematically in future-oriented qualification measures for the employees and thus in the future of the two sites in Germany,” the company said.

Profits have taken a hit in recent months with Audi readying huge factories in Ingolstadt and Neckarsulm, with a combined annual capacity of 6,75,000 units, for EVs to be built. Higher-than-average personnel costs and substantial research and development investment are cited as reasons for the cutbacks.

Earlier this month, Audi rival Daimler confirmed it would cut 10 percent of managerial roles to save €1.3bn (£1.11bn) in personnel costs. At the time, the parent company of Mercedes-Benz warned that the rollout of electrification would significantly harm its profits until at least 2021.

While the brand has not revealed how this affects its operations in our market, Audi India is gearing up to launch its range-topping Q8 SUV on January 15, 2020.