Volkswagen’s passenger car brand struggles with cost-cutting targets | Company news
 "Volkswagen")
At the time, it was said that the savings of up to 4 billion euros would take effect in the course of 2024 (Photo: Wikimedia Commons)
The Volkswagen car brand is struggling to reach its cost-cutting target of 10 billion euros (11.14 billion dollars). Problems such as low sales and a lack of spare parts are hampering the company’s efforts, the German business newspaper Handelsblatt reported on Wednesday.
A Volkswagen spokesman declined to comment.
The brand is two to three billion euros short of its savings target for this year, two anonymous sources told Handelsblatt.
The European carmaker, which is the leading carmaker by sales, announced details of planned cost cuts last December, which it hopes will increase the brand’s return on sales from 2.3 percent this year to 6.5 percent by 2026.
The measures the company listed to achieve this goal included reducing the administrative costs of its eponymous brand by a fifth, saving one billion euros by 2028 by shortening product development cycles from 50 to three years, reducing production times and abandoning a planned new €800 million research and development site in its home town of Wolfsburg.
At that time, it was said that savings of up to four billion euros would come into effect in the course of 2024.
Chief Financial Officer Arno Antlitz said at the carmaker’s annual financial conference in August that some measures would need time to take effect.
CEO Oliver Blume told the conference that the focus in the coming years would be on “costs, costs, costs” after reporting lower margins for the first half of the year.
First published: August 28, 2024 | 2:47 p.m. IS
