Audi to Deploy Workers to Defense Industry Amid Volkswagen Cuts
Translated & summarized from Calcalist by baba
German automaker Audi is sending employees to defense companies for up to two years as part of a plan to avoid layoffs amid broader cost-cutting measures at its parent company, Volkswagen. The affected employees will continue to receive their Audi salaries and can return to their automotive jobs afterward. This move involves collaborations with companies that have ties to Israeli defense firms, including KNDS, DIEHL, and MBDA. The defense industry's growth, driven by geopolitical tensions, contrasts with challenges faced by automakers like Audi and Volkswagen in markets such as China.
The story in 5 lines · by baba
- Audi is transferring employees to defense industries for up to two years to avoid layoffs.
- Employees will continue to receive their salaries from Audi during their external assignments.
- The defense contractors involved have partnerships with Israeli companies like Elbit Systems.
- The move is linked to Volkswagen's aggressive cost-cutting strategy and declining auto sales.
- Germany's defense sector is currently experiencing growth due to security concerns.
German automaker Audi is following Volkswagen's lead by transferring employees to defense industries for periods of up to two years, according to German reports. Audi employees at its Ingolstadt plants can opt for "external work" with defense contractors including Airbus, MBDA, DIEHL, and KNDS. Similar to Volkswagen's deal with Rafael, Audi's move has an Israeli connection, as KNDS, a manufacturer of tanks and artillery systems, has announced a collaboration with Israel's Elbit Systems on artillery systems. DIEHL also announced a strategic partnership with Elbit Systems for munitions development in June, and MBDA Germany revealed a cooperation with Elta for air defense systems in 2023.
Employees "loaned" to these defense manufacturers will continue to receive their salaries from Audi and are expected to return to their automotive roles after their two-year assignments. The majority of these employees are project managers and quality control staff, according to Automotive News. Audi stated the initiative aims to prevent layoffs and ensure continued salary payments.
The decision to redeploy workers to the arms industry is seen as a response to Volkswagen's aggressive cost-cutting measures aimed at restoring profitability, which include significant layoffs. Both Volkswagen and Audi have faced declining sales in the Chinese market. In contrast, Germany's defense sector is experiencing growth, partly due to security threats from Russia. Employees with expertise in electronics, quality control, and engineering are considered well-suited for integration into the defense industries.