Audi and its works council have reached an agreement that will see further investment in German production and an extended job protection plan, but the removal of up to 7500 jobs.
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It's part of a plan to find medium-term savings of more than one billion Euros (A$1.7bn) annually.
Audi says its management and the works council have agreed on a "socially responsible reduction by up to 7500 jobs in indirect areas by 2029, based on target scenarios".
It has pledged it won't lay off any worker for "operational reasons" until the end of 2033.
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The company is also investing further in its Ingolstadt and Neckarsulm plants in Germany, with the aim of improving productivity, speed and flexibility.
Audi plans to invest around eight billion Euros (A$13.7bn) at its "home locations" through 2029.
An entry-level electric model will enter production in Ingolstadt, while the next-generation Q3 will also be produced there in tandem with the Győr, Hungary plant where it's currently manufactured.
Audi says the production of both electric and combustion-powered vehicles in the same plant will make the site "robustly and flexibly positioned" in the transition to electrification.
Meanwhile, at Neckarsulm, Audi says it will strengthen its expertise in artificial intelligence, develop the electronic architecture of its combustion-powered vehicles further, and potentially produce an additional vehicle.
The works council has celebrated its "future-proofing" of the two plants.
"Through a temporary reduction and a new structure of the profit share program, the Audi workforce is giving a major contribution to making the four rings weatherproof and future-proof again," said General Works Council chairman Jörg Schlagbauer.
"Overall, the Audi workforce is investing many, many millions of euros in its own future over coming years."
Audi says the removal of up to 7500 jobs goes "hand in hand" with a reduction of bureaucracy, with Audi having already "significantly reduced the number of guidelines and committees".
The aim is to have the management structure flattened to just three levels, with "digitalisation" being examined to see where this can help reduce the workload in "indirect areas".
Remote work also appears to be under the microscope, with Audi saying "a stronger focus on presence in the workplace is intended to ensure close contact in times of increased communication needs."
Audi says it's extending its job protection plan until December 31, 2033, which it says will guarantee employment for those workers included but which will also allow it to reduce labour costs.
The General Works Council says it has secured the collectively agreed monthly wage, and says Audi won't reduce pay-scale wages or eliminate internal benefits. Current wage increases also will still take effect on April 1, 2025 and April 1, 2026.
Audi also manufactures cars in China, India, Mexico and Brazil. It recently announced the end of production at its Brussels, Belgium plant, which built the Q8 e-tron.
Global deliveries of its vehicles were down by 11.8 per cent in 2024, with declines not only in its home market of Germany but also China and North America. Deliveries also slumped by 19.5 per cent in Australia, with every model bar the A6 and Q3 down on the previous year.
Audi blamed the drop in global deliveries on challenging economic conditions, fierce competition, uncertainty over government electric vehicle (EV) incentives in some markets, and limited availability of parts.
It also said its new products have been slow to have an impact on its global sales volumes, and called 2024 a transitional year.
The four-ring brand's cuts coincide with cuts being made elsewhere across the Volkswagen Group.
Volkswagen is also undertaking a "socially responsible reduction in the workforce", with more than 35,000 jobs to be cut by 2030 and at least one factory being closed.
Porsche is also reducing its workforce by around 1900 positions by 2029, and phasing out a further 2000 positions currently held by workers on fixed-term contracts.
Content originally sourced from: CarExpert.com.au
