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Volkswagen may have to cut jobs in the United States as well as Europe and other countries depending on how big a fine has to be paid for its manipulation of diesel emissions tests, the carmaker's top labour official told a meeting of 20,000 workers at its German headquarters on Tuesday. The US Justice Department has sued Volkswagen (VW) for up to $46 billion for breaching US environmental laws, while there is still no fix for nearly 600,000 cars affected in the United States almost six months after the scandal broke.
The extent to which VW may be forced to cut jobs to help meet the costs of 'Dieselgate' depends "decisively" on the level of fines, VW's works councils chairman Bernd Osterloh said on Tuesday at the meeting of workers in Wolfsburg which was also attended by the carmaker's top managers. "Should the future viability of Volkswagen be endangered by an unprecedented financial penalty, this will have dramatic social consequences," said Osterloh, who also sits on VW's 20-member supervisory board.
Osterloh, speaking to workers at VW's flagship plant about the emissions crisis and structural changes, called on the US authorities to consider the risk of possible job cuts in deciding on penalties. "We very much hope that the US authorities also have an eye for this social and employment-political dimension," he said. Europe's largest automaker employs over 600,000 people at around 120 factories worldwide, including 270,000 in Germany. Its US plant in Chattanooga, Tennnessee employs about 2,200 people.
Speaking at the Wolfsburg meeting Chief Executive Matthias Mueller said the scandal would inflict "substantial and painful" financial damage on the carmaker, without elaborating. Volkswagen last year set aside 6.7 billion euros ($7.39 billion) to cover the expected costs of recalling of about 11 million diesel vehicles globally.

Copyright Reuters, 2016

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