Volkswagen cuts put Zwickau factory and region at risk

Volkswagen’s plan to eliminate 100,000 jobs by the end of the decade has raised fears for the future of its factory in Zwickau, Germany, with residents warning that a closure would severely damage the region, ERR reported.

The factory near Zwickau, a city of nearly 90,000 residents about a three-hour drive from Berlin, is one of four plants for which Volkswagen recently said it had no clear plan for the future.

The German automotive industry is facing pressure from Chinese competitors, US tariffs, high production costs and weak demand for electric cars. Volkswagen is responding with cuts.

Volkswagen is a crucial employer for Zwickau and the surrounding region, and local residents hope the factory will remain open.

“If the Volkswagen factory is closed, it would be a real tragedy for the whole region and for Volkswagen itself. Volkswagen has always been Germany’s flagship company,” a local resident named Peggy said.

Michael said the company’s problems were the result of poor policies over many years. “That is the problem, and now the consequences have arrived,” he said.

Another resident, Reiner, blamed unused technological opportunities and poor management. “I want Volkswagen to stay, because Zwickau is the cradle of Volkswagen and the automotive industry. You cannot simply give up a place like this,” he said.

Zwickau Deputy Mayor Silvia Queck said the impact of a closure would extend beyond Volkswagen’s workforce. The factory currently employs about 8,000 people, while suppliers could bring the total number of affected jobs to between 30,000 and 40,000, she said.

“For us, it would be a severe blow, because so much in this region depends on the automotive industry and Volkswagen as an employer,” Queck said.

The importance of car manufacturing to Zwickau is documented in a museum above the city’s first Audi factory. The first car was built in Zwickau in 1904, after engineer August Horch found suitable conditions there.

“There was a university focused on technical fields, good infrastructure with trains and trams in the city, and considerable wealth had already accumulated in industry. People wanted to invest their money in good ideas, and August Horch had plenty of them,” said Andre Meyer, research director at the August Horch Museum.

Local companies survived earlier crises by joining forces, Meyer said. In the mid-1920s, lower import tariffs allowed foreign cars to enter Germany more cheaply, putting pressure on German manufacturers. The global economic crisis followed in 1929, and only about 10 of more than 80 German carmakers survived, he said.

Cars later became part of everyday life, including the legendary Trabant built in Zwickau for people in East Germany. After the fall of communism, the cars could no longer be sold, and the Volkswagen era began.

“Volkswagen came and invested, symbolising hope for 4,000 factory workers and their suppliers,” Meyer said.

Today, electric cars leave the Zwickau factory. The next chapter for the plant remains uncertain.

“There is always a new beginning in a crisis. We do not know what it will look like, whether with Volkswagen or another company, but the infrastructure and the people are here,” Meyer said. He added that the region needed an investor with an idea and the right political framework, noting that energy prices were currently high by international standards.