Embrace Tesla competition, no job cuts in mind: VW boss

Volkswagen Group chief executive Herbert Diess has sworn to an increasingly fierce competition with Tesla during a meeting with his top management, reported dpa.

The headquarters in the northern German city of Wolfsburg must also "become more efficient, faster," the VW boss said at an internal conference in Alpbach, Austria, according to sources at the meeting. He reiterated that this would initially have no direct consequences for jobs.

"When I think of Wolfsburg, I don't have job cuts in mind," Diess stressed on Thursday. "That's not what it's about. For me it's about how we work together. We need a new way of thinking. It's not just about the [VW] brand, it's also about the group. It's about Wolfsburg."

On Wednesday, speculation about a possible imminent axing of tens of thousands of jobs at Europe's largest carmaker had caused a stir.

In response, the group's management made it clear that no plans for further cuts were on the table - but that the tense cost situation and capacity utilization at some locations would have to be discussed.

The current idle time due to the supply crisis for microchips, Volkswagen's earnings targets and the growing rivalry with Tesla also play a role. The US competitor plans to soon produce the first e-cars at its so-called gigafactory near Berlin.

"I know some of you hate this," Diess reportedly said at the meeting of some 200 executives, as well as other managers from China who joined by video.

"But first and foremost, it's Tesla. The gap is widening. They are getting faster. They're delivering. They're getting better at building cars. They are the only brand that is growing despite Covid. They have a fully networked fleet around the world. We have to embrace this competition."