VW CEO: The roof is on fire; wants USD 11 billion in savings

It seems all is not well at Volkswagen, and the CEO has sounded the alarm.

While Volkswagen has been busy releasing and developing electrified vehicles including EVs, its expenditures appear to be taking a huge toll on the automaker. So much so that Volkswagen CEO Thomas Schäfer has warned the company that costs are running high and that they need to look for billions in savings.

During an internal online meeting with more than 2,000 Volkswagen managers, the CEO shared a difficult path ahead as unprecedented EV investments weigh heavily on the company. While Volkswagen plans on becoming a leading manufacturer of EVs, it also needs to continue selling cars powered by internal combustion engines (ICEs) to serve global markets that have yet to make the switch to EVs.

With high costs putting the company in jeopardy in the next several years, Schäfer told everyone during the meeting that “The roof is on fire, we are letting the costs run too high in many areas”, said the CEO. The executive added that in the coming weeks and months, Volkswagen will be at a very tough time and called on the managers to celebrate “small wins”.

But in order to allow the company to actually save on costs, Volkswagen will be introducing new “performance programs” that will be aimed at saving the automaker as much as USD 11.23 billion over the next three years.

Currently, Schäfer said that the current structure and processes within the company are too complex, slow, and inflexible. Combined with the high costs the automaker has incurred as of late, as well as the fact that the brand is now facing a price war in one of its biggest markets (China), Volkswagen is struggling to manage its funds and investments.

With Volkswagen now looking to cut costs and better manage its funds, the Wolfsburg-based company is heading for tougher times, indeed.

Sources: Carscoops via AutoCar UK