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According to Motor1, Audi has just announced that it will be laying off a total of 7,500 employees by 2029 in a bid to boost the speed, productivity, and flexibility of its factories in Ingolstadt and Neckarsulm, Germany. The German automaker stated that this move will save them over €1 billion annually, roughly equivalent to US$1.1 billion.
Audi plans to invest €8 billion (around US$8.7 billion) in domestic production facilities by 2030. They will also be adding an electric car to the production line at the Ingolstadt plant, while preparing the Neckarsulm plant for digitalization and AI integration.
A future fund worth €250 million (approximately US$273 million) will be established by Audi to set up new production platforms for its upcoming electric car lineup.
“Economic conditions are becoming increasingly challenging, and competitive pressures and political instability are presenting the company with significant challenges,” Audi said in a statement.
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The uncertainties surrounding the electric vehicle mandate in the US and the threat of cheap Chinese electric cars are putting financial pressure on Audi and its parent company, Volkswagen. The impact of new tariff policies in the US may also force Audi to shift its production to the country.
Audi will base its job cuts on target scenarios, aiming to accelerate the brand’s development and innovation. Reuters reported that since 2019, Audi has cut a total of 9,500 jobs, mainly from administrative, R&D, and similar departments.
Audi has extended the job security agreement with the unions at its German factories until 2033, as the company plans to produce fewer but more expensive cars.
Last month, Audi announced its shift towards the premium segment to increase brand prestige, appeal, and awareness. They also confirmed their focus on business quality over quantity, likely indicating a reduced priority on sales targets.
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