Volkswagen's Christmas Miracle: A New Path Amid Challenges

Volkswagen announced major operational changes in Germany, reaching a deal with unions to cut 35,000 future jobs. The agreement, seen as a 'Christmas miracle', avoids mass strikes and includes capacity reductions. The plan aims to address overcapacity, competition, and slow electric vehicle adoption, securing Volkswagen's long-term competitiveness.

Volkswagen announced significant changes to its German operations on Friday, unveiling plans for future job cuts and capacity reductions. The deal was reached after marathon negotiations with unions, who hailed it as a 'Christmas miracle' for avoiding mass strikes.

The agreement includes cutting 35,000 future jobs while ensuring no immediate site closures or layoffs occur. Volkswagen aims to address challenges like competition from cheaper Chinese rivals and slow electric vehicle adoption.

Investors welcomed the news with shares rising by 2.4%. The company projects savings of 15 billion euros annually and plans to repurpose some production sites by 2025, including shifting production to Mexico.

(With inputs from agencies.)