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Audi’s European Plants to Suspend Production

17 Mar 2020

source: Reuters and Volkswagen Group, words: Bill, photos: Audi AG

Editor’s note: Volkswagen press release about the shutdown was just released so we added it to the bottom of the article.

According to a news bit from Reuters, Volkswagen Group is suspending production at most of its sites. These include Audi AG’s facilities in Ingolstadt, Neckarsulm, Brussels, Mexico, and Gyor (Hungary). Volkswagen Group facilities in Spain, Portugal, Slovakia, and Italy are also shutting down. Volkswagen’s factories in the United States (Chattanooga, TN), Mexico (Puebla), and Brazil are not affected at this time.

The reason, of course, is the coronavirus pandemic disrupting supply chains, sales, and general life in Europe. The shutdown will probably last for two to three weeks.

Chief Executive Herbert Diess:”Given the present significant deterioration in the sales situation and the heightened uncertainty regarding parts supplies to our plants, production is to be suspended in the near future at factories operated by group brands.”

“2020 will be a very difficult year. The coronavirus pandemic presents us with unknown operational and financial challenges. At the same time, there are concerns about sustained economic impacts,” Diess said.

Update: press release from Volkswagen Group

Volkswagen brand suspends production on Thursday due to corona crisis
› Plants operated by Volkswagen Passenger Cars brand suspend production for two weeks
› Plants of Volkswagen Group Components also affected
› Initially, production facilities in Wolfsburg, Emden, Dresden, Osnabrück, Zwickau, Bratislava (Slovakia), Pamplona (Spain) and Palmela (Portugal) are affected, as well as the Components plants at Brunswick, Chemnitz, Hanover, Kassel, Salzgitter and SITECH
› Brand is responding above all to the accelerated rate of infection by coronavirus, the resulting interruption in supply chains and the rapid decline in demand on the automotive markets
› Company implements additional measures to protect employees

The Volkswagen Passenger Cars brand is gradually suspending production at its European plants. This will also affect Volkswagen Group Components plants. This is the brand’s response to the impending rapid decline in demand on the automotive markets. Risks in connection with suppliers’ supply chains are also increasing. This is due to the significantly accelerated rate of infection by coronavirus and the resulting measures taken by the authorities. Initially, the factories are therefore expected to remain closed for two weeks. For the affected German sites, the measures are to apply from the end of the late shift on Thursday.

Ralf Brandstätter, Chief Operation Officer of the Volkswagen Passenger Cars brand, says: “The spread of coronavirus in Europe is increasingly having an adverse impact on the demand situation. At the same time, it is becoming increasingly difficult to supply our plants with outsourced parts. For this reason, we have decided to run production down in a coordinated way from the end of the late shift on Thursday. We are convinced that this will also be in the interests of our employees who are becoming increasingly concerned about the spread of corona.”

Gunnar Kilian, HR Board Member of the Volkswagen Group, emphasized: “We have also supplemented our comprehensive health protection measures with a number of other measures. We understand the concerns of our employees. Since the beginning of the corona epidemic in China, we have consistently operated on the basis of the principle that health is our top priority. Our employees can rely on that.”

Works Council Chairman Bernd Osterloh welcomed the suspension of production: “At times when people can no longer meet on playgrounds or for concerts, go to church or visit restaurants in the evening and are no longer buying cars, and Volkswagen has supply problems, production cannot simply continue as if nothing had happened. For our colleagues in production, there are is therefore no alternative to the controlled suspension of production. All the points which remain open will be clarified between the company and the Works Council.”

To protect its employees, Volkswagen is implementing further measures to prevent the spread of coronavirus. From today onwards, the company canteens, self-service shops, cafeterias, bistros, restaurants and catering services will be closed. As a general principle, all meetings will be held by Skype or video. All major events have been canceled.

Moreover, special protection applies for employees with special health risks as a result of pre-existing conditions affecting the heart or lungs and employees with weakened immune systems, among others.

Furthermore, employees returning to Germany from other countries after March 14 are forbidden with immediate effect from entering the plant sites and other facilities of Volkswagen AG during the incubation period of 14 weekdays.

In order to keep transmission of the virus as low as possible, contacts should be largely avoided. Managers and employees should review the possibilities of mobile working, i.e. working from home. As a general principle, mobile working is possible for up to five days per week.

The measures also include a general halt to business trips – for all plants and also to other countries. This also applies to trips between locations. The internal shuttle flights between locations have already been halted.