Something's gotta give.
Investing in something as big as electric vehicles including the infrastructure, technology, and plant re-tooling necessary to make them viable comes at a significant cost. But the long-term rewards are expected to pay off handsomely. Audi, like its parent company Volkswagen Group, has committed itself to an EV future with plans to launch five fully-electric and seven plug-in hybrid models within the next two years – alongside the already revealed e-tron and e-tron Sportback. More than 30 electrified vehicles are planned by 2025. It's a heavy product load without question, and it's not going to come cheap.
Reuters reports a new plan by Audi to eliminate about 15 percent of its German workforce that will allow earnings to increase by $6.6 billion. A total of up to 9,500 jobs will be cut by 2025.
Not all cut jobs will be from the factory floor but will also include management-level positions. "The company must become lean and fit for the future, which means that some job profiles will no longer be needed and new ones will be created," Audi said in a statement.
The restructuring plan, however, will also create another 2,000 new jobs in the fields of electric mobility and digitalization. The rest of the 50,000-strong Audi workforce in Germany have job guarantees through 2029. Following the aftermath of the Dieselgate scandal, which saw now-former Audi CEO Rupert Stadler arrested and tossed in jail for his alleged role in the cover-up, the German automaker is anxious to start afresh. Electrification, it has determined, is the way forward.
The e-tron and e-tron Sportback are expected to be joined in 2021 by the e-tron GT sedan. The next-generation TT coupe has been canceled in favor of an electric version. The Q4 e-tron, which fills the segment slot between the Q3 and Q5, is expected to go on sale in early 2021. There's also another important reason why Audi is making these cuts: an auto industry downturn, which we also just reported about. Both the US and China are experiencing a new vehicle sales slowdown caused by several factors including new emissions standards and trade wars.