Audi plans to cut 7,500 jobs in Germany by 2029 as part of a strategy to streamline operations and save over one billion euros annually. The job reductions will focus on administrative roles, ensuring production remains stable. While profit-sharing plans will be adjusted, base salaries and agreed wage increases will continue. The company also aims to reintegrate 1,000 jobs through insourcing and has committed to producing the Q3 model in Ingolstadt.
Audi’s Job Cuts: A Strategic Move Towards Efficiency
For several months, Audi has been navigating through challenging savings plans, and a recent agreement has been reached between the company and its employees. By the conclusion of 2029, the renowned car manufacturer will eliminate a total of 7,500 positions in Germany.
As part of a broader strategy to achieve significant financial savings, Audi aims to streamline operations and generate over one billion euros annually in the medium term. This decision follows extensive negotiations between the company and the works council, resulting in a mutually agreed-upon plan. Initially, there were discussions about potentially cutting up to 12,000 jobs, as indicated by Jörg Schlagbauer, the chairman of the general works council.
“In order to thrive, Audi must evolve into a more agile, efficient, and quicker entity. It’s evident that personnel adjustments are essential to achieve this,” stated CEO Gernot Döllner. Notably, there will be no operational layoffs until the end of 2033, which is a positive development for employees during these economically challenging times.
Understanding the Job Cuts
Audi has clarified that the impending job cuts will primarily impact the “indirect area,” meaning that production will remain unaffected while bureaucratic processes are streamlined. Furthermore, the cuts will be implemented thoughtfully rather than randomly, as HR director Xavier Ros emphasized that the “team structure will be strategically aligned with future requirements.”
In addition to job cuts, Audi employees will also face financial adjustments. The profit-sharing scheme is set for a structural overhaul and a reduction over the next several years, which will involve substantial amounts. For instance, in 2024, employees received 8,840 euros as profit participation for the previous year, a figure that may see a decline due to the company’s recent performance.
Audi plans to disclose complete financial figures for the 2024 fiscal year soon. In the first nine months, profits nearly halved, attributed to supply chain issues for crucial engines, decreased demand in China, and expenses related to the closure of its Brussels plant. Production was briefly resumed in early February for three weeks to fulfill some of the existing orders.
Negotiation Outcomes and Future Prospects
Schlagbauer highlighted the workforce’s vital role in enhancing the company’s resilience and future viability, noting that employees are investing millions into their own future. Thanks to the constructive negotiations, many potential issues have been successfully avoided. Crucially, neither base salaries nor bonuses will be impacted, and agreed wage increases will proceed as planned.
Additionally, the company is committed to producing the Q3 model in Ingolstadt and will reintegrate 1,000 jobs through insourcing, which involves bringing back previously outsourced functions.
“We acknowledge that some elements of the future agreement may entail sacrifices for employees,” HR director Ros remarked. “However, these measures are vital to avert operational layoffs, which has always been our primary goal.”
Looking ahead, members of IG Metall can anticipate an additional bonus starting in 2026, as shared by Karola Frank, chairwoman of IG Metall at Audi in Ingolstadt. Horst Ott, the IG Metall district leader for Bavaria, praised this initiative, stating, “This recognizes the solidarity among employees, fostering a robust IG Metall that drives collective agreements and positive negotiation outcomes.”
All parties involved in the negotiations have taken responsibility, securing the collective agreement and fortifying Audi’s future in Germany, as Ott concluded.