Volkswagen has announced plans to cut back on versions and trim options in order to save €1.9 billion necessary to face the Dieselgate.

Volkswagen has announced plans to cut back on versions and trim options in order to save €1.9 billion necessary to face the Dieselgate.

The company’s top labor representative, Bernd Osterloh, told journalists gathered on Friday at VW’s headquarters in Wolfsburg the Volkswagen core brand will reduce the number of versions and trims available. Doing so will lower complexity and costs, ultimately allowing VAG to save as much as €1.9 billion. This bold savings target will be possible also by lowering bonuses given to senior executives.

Osterloh said during the meeting that “we from the works council have long flagged the huge range of model variants and different components.” He went on to specify “that brings enormous complexity and adds to costs, for example, for logistics. We can take out costs there on a large scale and don't have to talk about job cuts.”

Osterloh admitted these major savings will be crucial for the brand given the current context in which customers have expressed their reluctance as far as buying a new VW. That’s because the 1.2 TDI, 1.6 TDI, 2.0 TDI EA189 engines and the 3.0 TDI V6 have all been red-flagged due to the various defeat devices installed.

In total, company boss Herbert Diess says the Volkswagen brand will be able to save as much as €5 billion and doing so will require reducing annual investments by €1 billion.

Source: Volkswagen via europe.autonews.com

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Volkswagen to reduce number of versions and trims to save €1.9 billion