Volkswagen Considers Down-Cuts In Order To Cope With Economic Decline

Publish On: 08 Jun, 2020 11:21 AM | Updated   |   Madhurima  

WOLFSBURG: Internationally acclaimed German automaker, Volkswagen is considering to go with more cost cuts in order to cope with the downturn in the business which has resulted due to the COVID-19 pandemic, as per a representative of the company.

The matter was taken up at an event the internal level, the spokesperson of Volkswagen mentioned when asked about the report for a renowned industry magazine.

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The spokesperson stated, "There were general deliberations about what further cost measures could be taken to respond to the pandemic. There are no concrete decisions yet."

The aforementioned magazine has also mentioned that Herbert Diess, the Volkswagen CEO has told the top managers at a meeting, "We must significantly cut R&D expenditure, investments and fixed costs compared with the previous planning."

The auto major's net liquidity will "continue to decline at least until July due to weak demand", as per Diess. It also mentioned that not many auto brands will manage to get a positive or profitable result in the year 2020.

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This also means that the company will probably reduce its material overheads by 20%, as per the magazine.