Volkswagen’s Average Severance Package Lags Behind Maximum Sum, Report Says
A recent report by the German news magazine Spiegel reveals that the average severance package paid out by Volkswagen as part of its job reduction program has been around 200,000 euros, significantly lower than the maximum sum of 404,700 euros that has been widely reported.
The Volkswagen Group, Europe’s largest automaker, aims to reduce its workforce in Germany by 35,000 employees by 2030. According to the Spiegel, only a small portion of the job cuts have been finalized through collective bargaining agreements. To date, around 1,200 to 1,300 employees have signed off on severance packages, which are either in line with the company’s basic agreement or the higher “Tarif Plus” agreement.
Despite this, the company has already committed to reducing its workforce by 22,500 employees, a number that surpasses the 20,000 figure previously communicated by the company’s personnel chief, Gunnar Kilian. The discrepancy is due to the calculation basis, with Kilian’s figure only accounting for the six sites where the company’s basic agreement applies, such as Wolfsburg, Hannover and Emden. The additional sites in Saxony and Osnabrück, however, contribute to the higher total.
The company considers the higher number to be the relevant benchmark for its overall goal of reducing its workforce by 35,000 employees by 2030. Since the hiring freeze was implemented at the end of 2023, the company has only approved around 20 external new hires, each of which now requires a board decision.