German carmaker Volkswagen says it plans to cut thousands of jobs as a part of a restructuring plan.

VW workers assemble Volkswagen Passat sedans at the German automaker's plant in Chattanooga,
VW workers assemble Volkswagen Passat sedans at the German automaker's plant in Chattanooga, (Erik Schelzig / AP)

Volkswagen on Wednesday said it will shrink its workforce by up to 7,000 staff, raise productivity and eke out $6.6 billion annual savings at its core VW brand by 2023 in a bid to raise VW’s operating margin to 6 percent.

Volkswagen has ruled out compulsory layoffs until 2025, but early retirement will help the Wolfsburg, Germany-based carmaker to reduce its workforce between 5,000 and 7,000 positions, the carmaker said.

“The measures from the earnings improvement programme will enable our brand to achieve a competitive return level of six percent in 2022,” Arno Antlitz, Volkswagen brand’s board member for controlling, said in a statement.

Source: Reuters