VW May Cut Workforce Due to Costly Diesel Scandal Lawsuits

Volkswagen today hinted at what is likely on the mind of many company employees. During a large company meeting in Wolfsburg, Germany, Volkswagen's works council chairman Bernd Osterloh said the automaker may need to cut thousands of jobs as a result of the fines and lawsuits it faces from the diesel emissions scandal.

Osterloh is calling on government officials to consider what's at stake when deciding how much to fine the automaker.

"Should the future viability of Volkswagen be endangered by an unprecedented financial penalty, this will have dramatic social consequences," said Osterloh. "We very much hope that the U.S. authorities also have an eye for this social and employment-political dimension."

VW currently employs 600,000 people worldwide, including 2,200 employees at its plant in Chattanooga, Tenn. Among the many lawsuits it faces is one from the U.S. Justice Department to the tune of $46 billion. The automaker has already sought out a loan tohelp cover the costs, though it still has yet todisclose a suitable solutionin the U.S. where around 600,000 vehicles are affected.

There are hints the U.S. government is seeking other demands in addition to the lawsuits. Rumors suggest that the Environmental Protection Agency is asking Volkswagen to start building electric vehicles at its Chattanooga plant, as well as increasing the network of charging stations in the country. Meanwhile, a U.S. judge recently gave Volkswagen until March 24 to come up with a solution, though the automaker has suggested a solution is still months away.

Source: Reuters