Manufacturing AUTOMATION

Volkswagen to close Europe plants for two weeks

March 17, 2020
By David McHugh, The Associated Press

Volkswagen said Tuesday it would close most of its European plants for two weeks due to uncertainty about demand for cars and supplies of parts amid the virus outbreak and said it wasn’t possible to give a reliable outlook for this year’s profits.

The company said, however, that its China business was coming back as the number of new cases lessens there and that its ambitious plans to scale up production of electric cars remained on track.

CEO Herbert Diess made the announcement at the start of the company’s annual news conference. The dpa news agency, citing employee representatives, said that the last shifts would run this Friday in most locations. The company’s facilities in Italy, where the outbreak has been particularly severe, have already shut down.

The company had previously said it expects a four per cent increase in sales this year but Chief Financial Officer Frank Witter said Tuesday that uncertainty about the severity and duration of the virus outbreak made it impossible to give a reliable prediction. Diess said 2020 would be “a very difficult year” as the virus outbreak “presents us with unknown challenges.”


He said the company still intended to achieve its ambitious rollout of the ID.3, a mass-market electric compact being produced in Zwickau, Germany that should hit the market this summer. The car is key to the company’s efforts to meet tough new European Union limits on emissions of carbon dioxide, the primary greenhouse gas blamed for global warming. “We are standing by our electrification plan,” Diess said.

Volkswagen last year made net profit of 14.02 billion euros, up 15 per cent from 12.2 billion euros in 2018. Revenue for the year rose seven per cent to 252.6 billion euros ($281 billion).

News from © The Canadian Press Enterprises 2020

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