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Audi to save £5bn for electric car investment with 9,500 job cuts

By Francis Jay

Emissions targets and automation drive workforce reduction

Carmaker Audi has announced plans to cut around 9,500 jobs at its German factories in the next five years and invest the subsequent €6bn ($6.6bn, £5.1bn) of saved costs in electric cars and digital technology.

The executive auto manufacturer, which itself is part of Volkswagen, described the decision as driven by its desire to “become lean and fit for the future”. While it is preparing to make more than one in 10 of its total staff redundant, Audi also outlined its plan to hire 2,000 workers in “new expert positions in areas such as electric mobility and digitalisation”.

Audi is following the wider trend in the global auto market, where manufacturers are caught between automation and environmental pressure. With ever-improving machine learning and artificial intelligence, manufacturers no longer require such large human workforces.

The struggle to meet new emissions targets is also affecting many carmakers, especially those in Germany. Only two weeks ago, Mercedes-Benz announced its intention to cut more than 1,000 jobs in the next two years, citing tougher emissions targets as a factor.

Audi is thought to be pushing so hard for more environmentally friendly cars as a penitential act to help it recover from its part in the German emissions scandal, which has been dubbed ‘Dieselgate or Emissionsgate’. Last year Audi paid an €800m ($879m, £683m) fine for its role in the affair, which saw VW use technology to cheat diesel emissions tests. Former Audi boss Rupert Stadler is accused of false certification and criminal advertising practices.

Commenting on the cuts, Bram Schot, Audi’s current CEO, stated: “This will increase productivity and sustainably strengthen the competitiveness of our German plants.”

The chairman of the Manufacturers’ Works Council said: “We have reached an important milestone: the jobs of our core workforce are secure. The extension of the employment guarantee is a great success in difficult times.”

FURTHER READING: Audi spin-out launches in-car virtual reality

FURTHER READING: Chinese auto-executives hope for rebound in electric vehicle market

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