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Fewer jobs cut than expected at Volvo Cars

Volvo Cars announced on Monday it would be shedding 2,721 of the 3,900 Swedish jobs it has previously announced would be cut.

Published: 8 December 2008 14:26 CET

“Negotiations between Volvo Car Corporation and its union representatives have now been completed,” the group announced in a statement about union talks related to a restructuring plan which will result in 4,616 jobs losses globally.

The news comes at the same time the government is considering a major package of loans and loan guarantees to help Swedish vehicle makers.

In June and October, Volvo Cars had given notice that a total of 3,900 full time positions in Sweden were on the line out of cuts expected to reach 6,000 worldwide.

In the statement, the company said it would trim 2,367 workers governed by collective wage agreements.

In addition, 354 white collar employees would lose their jobs, considerably fewer than originally thought.

“An additional 680 employees abroad will leave the company. Also, 1,215 contracts with consultants have been terminated,” said Volvo.

Most of the redundant employees will leave the company by December 31, it said.

Volvo Car Corp., which Volvo Group sold to Ford in 1999, employs some 24,400 employees worldwide.

Cash-strapped Ford announced last week it was considering selling the unit, its last foreign premium marque, as the three big US carmakers seek a bailout in government-backed low-cost loans.

The Volvo car group has been hit hard by declining sales, as interest for its big, costly and gas-guzzling models dwindles.

In the third quarter, the company posted a net loss of $458 million, nearly three times its full-year 2007 loss of $164 million.

From lizards to water, eco-bumps snag Tesla's giant Berlin car factory

Tesla's gigafactory outside the doors of Berlin. dpa-Zentralbild | Patrick Pleul

“When I saw on TV that the Tesla factory was going to be built here, I couldn’t believe it,” said Steffen Schorch, driving his trusty German-made car.

The 60-year-old from Erkner village in the Berlin commuter belt has become one of the faces of the fight against the US auto giant’s first European factory, due to open in the Brandenburg region near Berlin in July.

“Tesla needs far too much water, and the region does not have this water,” said the environmental activist, a local representative of the Nabu ecologist campaign group.

Announced in November 2019, Tesla’s gigafactory project was warmly welcomed as an endorsement of the “Made in Germany” quality mark – but was immediately met with opposition from local residents.

Demonstrations, legal action, open letters – residents have done everything in their power to delay the project, supported by powerful
environmental campaign groups Nabu and Gruene Liga.

Tesla was forced to temporarily suspend forest clearing last year after campaigners won an injunction over threats to the habitats of resident lizards and snakes during their winter slumber.

READ MORE: Is Germany’s Volkswagen becoming ‘the new Tesla’ as it ramps up e-vehicle production?

And now they have focused their attention on water consumption – which could reach up to 3.6 million cubic metres a year, or around 30 percent of the region’s available supply, according to the ZDF public broadcaster.

The extra demand could place a huge burden on a region already affected by water shortages and hit by summer droughts for the past three years.

Local residents and environmentalists are also concerned about the impact on the wetlands, an important source of biodiversity in the region.

Tesla Street

“The water situation is bad, and will get worse,” Heiko Baschin, a spokesman for the neighbourhood association IG Freienbrink, told AFP.

Brandenburg’s environment minister Axel Vogel sought to play down the issue, saying in March that “capacity has not been exceeded for now”.

But the authorities admit that “the impact of droughts is significant” and have set up a working group to examine the issue in the long term.

The gigafactory is set to sprawl over 300 hectares – equivalent to approximately 560 football fields – southwest of the German capital.

Tesla is aiming to produce 500,000 electric vehicles a year at the plant, which will also be home to “the largest battery factory in the world”,
according to group boss Elon Musk.

In a little over a year and a half, swathes of coniferous forest have already been cleared to make way for vast concrete rectangles on a red earth base, accessed via the already iconic Tesla Strasse (Tesla Street).

German bureaucracy

The new site still has only provisional construction permits, but Tesla has been authorised by local officials to begin work at its own risk.

Final approval depends on an assessment of the project’s environmental impact – including the issue of water.

In theory, if approval is not granted, Tesla will have to dismantle the entire complex at its own expense.

But “pressure is being exerted (on the regulatory authorities), linked to Tesla’s significant investment”, Gruene Liga’s Michael Greschow told AFP.

In early April, Tesla said it was “irritated” by the slow pace of German bureaucracy, calling for exceptions to the rules for projects that help the environment.

Economy Minister Peter Altmaier agreed in April that his government “had not done enough” to reduce bureaucracy, lauding the gigafactory as a “very important project”.

Despite Germany’s reputation for efficiency, major infrastructure projects are often held up by bureaucracy criticised as excessive by the business community.

Among the most embarrassing examples are Berlin’s new airport which opened last October after an eight-year delay and Stuttgart’s new train station, which has been under construction since 2010.

Brandenburg’s economy minister, Joerg Steinbach, raised the possibility in February that the Tesla factory could be delayed beyond its July planned opening for the same reason.

SEE ALSO: Tesla advertises over 300 jobs for new Gigafactory near Berlin

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