The largest Chinese car manufacturer Saic According to insiders, he wants to bring thousands of jobs to his joint ventures Volkswagen and General Motors tear down. Jobs will also be lost in the electric car division, two people familiar with the process told the Reuters news agency on Monday.
The group therefore wants to retain ten percent of the jobs Saic-Volkswagen and more than half at its subsidiary Rising Auto EV cancel. It was said that 30 percent would be lost in the joint venture with GM.
Tough price war as a trigger
Large-scale workforce reductions are rare among Chinese state-owned companies. However, there is currently a tough price war in the car industry as domestic demand is weakening. The planned cuts also reflect the rapidly growing adoption of electric vehicles in China. Here Saic and its foreign partners have market shares to the US car manufacturer Tesla and private Chinese competitors such as BYD lost.
Saic spokesman denies reduction as “untrue”
A large part of the reductions will come through the introduction of stricter performance standards and severance pay for employees with lower classifications. A Saic spokesman said that the “speculation” about the workforce cuts was “untrue”. The company also does not set any targets for laying off employees. Saic did not respond to questions about efforts to encourage low-performing employees to quit or other strategies for downsizing. The company said it hired 2,000 people in the first two months of the year to focus on software and new-drive vehicles.
Reactions from GM and VW China
A GM spokesman in China said it would be “inaccurate” to say the joint venture plans to reduce its workforce by nearly a third. A spokesman for the VW China Group emphasized that no layoffs were planned.
Saic has been China’s largest automobile manufacturer for almost two decades. In the first two months of the year, however, sales fell by 16 percent compared to the same period last year. According to the annual report, the company employed around 207,000 people at the end of 2023, including its main subsidiaries.