According to reports, the Volkswagen Group will suspend production of the Volkswagen ID.3 and Cupra brand Born hatchbacks in Germany this week. The suspension is expected to last until the end of this year. The Volkswagen Zwicaku plant has experienced multiple production challenges this year. In October, ID.3 and Born were suspended for two weeks, and after production resumed in November, the factory canceled the third production shift.
The reason for frequent production suspensions should come from the demand side. Consumer demand for these two cars is lower than expected, which has brought huge challenges to the Volkswagen Group, so that the measures taken previously did not solve the problem of supply and demand imbalance. As a result, the group decided to suspend the production of these two cars again, and the suspension will last as long as a month.
To make matters worse, the Zwickau plant's production line for crossovers and SUVs (Volkswagen ID.4, ID.5, Audi Q4e-tron and Q4Sportbacke-tron) has been idle for about three weeks due to insufficient supply of rear-wheel drive units. Supply issues for the Volkswagen Group's new APP550 drive units also involve other plants in Europe.
However, the good news is that reports indicate that Volkswagen is expected to restart production of crossovers and SUVs this week, but it is unclear whether the company will resume full production or limited production.
The situation at Volkswagen Group is reportedly becoming "critical" after CEO Thomas Schaefer warned employees about the brand's lack of competitiveness.
The Zwickau plant did not renew the contracts of 269 employees this year, and a company spokesman said that nearly 500 temporary workers would also not be able to renew their contracts next year. Reports say layoffs related to production cuts may continue into 2024.