Volkswagen eyes pay cuts to achieve majority of savings, reports Handelsblatt #NewsGerman

BERLIN (Reuters) -Volkswagen wants to achieve the majority of its billion-euro savings drive through pay cuts, Handelsblatt reported on Tuesday, citing a management board document.

A proposed 10% cut to salaries at the core brand alone would bring in almost 800 million euros ($864 million) annually, Handelsblatt cited the document as saying.

In addition to the cancellation of various bonus payments, allowances and pay rises, savings would add up to around 2 billion euros per year total, which is about half of the targeted savings of 4 billion euros, it reported.

Volkswagen did not immediately respond to requests for comment from Reuters.

Volkswagen’s works council head said on Monday that the carmaker plans to shut at least three factories in Germany, lay off tens of thousands of staff and shrink its remaining plants in Europe’s biggest economy as it plots a deeper-than-expected overhaul.

Closing and selling off plants would bring significantly less in savings, Handelsblatt reported.

Volkswagen wants to adjust capacities but avoid closing sites if possible, with the aim being to find new owners for affected plants if necessary, according to the document.

The list of suggestions for savings also includes measures that affect component production and technical development.

However, the document does not contain any information on the total possible number of jobs at risk, said Handelslblatt.

($1 = 0.9261 euros)

(Writing by Miranda Murray, Editing by Friederike Heine and David Evans)