Although reduced working hours are known as an effective way of reducing costs and saving jobs, the materiality of the measure is subjective. As the efficacy of the measure also depends on how much work a company, or even an individual department within a company, has.
Volkswagen, the German automaker, has stated that it does not need to apply the four-day workweek to save jobs. Even though Germany’s largest trade union had proposed adopting a four-day week across industries last month. This proposal came to help companies control labour costs and retain jobs.
Bernd Osterloh, chairman of the Volkswagen, works for the council—the body that handles discussions and negotiations between employee representatives and management—was reported as saying that the company's existing cost control measures were enough to sustain in the COVID-19 crisis even with the plunging car sales. Volkswagen is currently making the transition to electric cars and more highly automated production lines, which reduce the manpower needs.
However, Osterloh also mentioned that there is no such shortage of work, as production levels for some of the automaker's most popular models continued to be high. He even conveyed that Volkswagen might overtake Tesla in production by 2023. "At the moment we are not talking about less work," he said. "With the [Volkswagen Golf] we had the [production] levels of last year in June and July and introduced extra shifts. The four-day week is not an issue for us."
Although reduced working hours are known as an effective way of reducing costs and saving jobs, the materiality of the measure is subjective. As the efficacy of the measure also depends on how much work a company, or even an individual department within a company, has.
The current cost control measures at Volkswagen are directed by its Future Pact program, rolled out in 2016. Under the program, the automaker has been shedding jobs since before the pandemic began: last year, it announced that it would be cutting up to 7,000 jobs by 2023. In July this year, Osterloh informed analysts and investors that the program was sufficiently effective that incremental cost cuts—specifically structural cost programs such as mass layoffs—are not presently needed.