Audi has signed an agreement with its workforce that will include cutting 9,500 job cuts in factories as they experience a major industry shift to electrification, which itself should add 2,000 jobs to produce electric cars.
Last year, IG Metall, Germany’s biggest trade union, commissioned a study that showed “electric cars are more labor efficient to make than gas-powered cars and will lead to job losses.”
With fewer moving parts, electric motors are simpler to produce than internal combustion engines, and the battery pack is the biggest part of an electric car, but many automakers don’t plan to make their own cells, which constitutes most of a battery pack.
Auto worker unions have feared that the shift to electric vehicles will cost them jobs, and Audi confirmed it today in their latest agreement with their workforce:
In the context of the transformation of the automotive industry toward electric mobility and digitalization, the company and the Works Council have agreed on important new plans.
They have “agreed to cut up to 9,500 jobs until 2025,” most of which will be cut following demographics and through early retirement offers.
Along with the job cuts, Audi plans to create up to 2,000 new jobs in electrification and digitalization:
The company plans to create up to 2,000 new expert positions in areas such as electric mobility and digitalization.
The German automaker is currently producing its e-tron electric SUV in Brussels.
Audi’s Ingolstadt factory is currently being prepared for “the production of premium electric vehicles” and its Neckarsulm factory will produce the all-electric Audi e-tron GT as soon as next year.
Bram Schot, Audi CEO, commented on the new agreement:
Both sides have proven that the focus is on responsibility for the future of the Four Rings and its employee. Audi.Zukunft secures our sustainable growth. In times of upheaval, we are making Audi more agile and more efficient. This will increase productivity and sustainably strengthen the competitiveness of our German plants.
The new agreement also secured Audi’s employee profit sharing and increased retirement provisions.
Yes, electric vehicles will likely lead to job cuts, but it’s not a reason for work councils to try to slow it down.
Automakers who are not all-in in electrification are going to lose all their jobs.
Instead, they need to invest early, and then they have a chance to come out on top and still have jobs to offer.
Also, they could develop expertise in things like battery manufacturing, which could then create more jobs.
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