Volkswagen plans to shed 30,000 employees

BONN (Reuter) - Volkswagen, the German car maker, is planning to cut 30,000 jobs worldwide within two years as a declining domestic market and falling exports bite into profits, industry sources said yesterday.

Analysts said the cuts appeared to confirm expectations of a change in approach by VW's new chairman, Ferdinand Piech, who has a reputation as a tough manager who can slash costs.

The sources said a supervisory board meeting tomorrow should approve cutting the jobs from VW's worldwide workforce of 273,000 by the end of 1994. The cuts include 7,500 announced last year.

The meeting should also approve an acceleration of VW's plans to complete the 7,500 job cuts by the end of 1993.

The VW group includes the VW marque, Audi, Seat of Spain and Skoda, the Czech company. It was not clear in detail where the 30,000 job cuts would fall.

The sources said VW was planning to cut 1993 vehicle production to 3.2 million from 3.5 million. Production plans had already been cut from 3.8 million.

In Milan, Fiat said it would temporarily lay off 35,000 workers in February and early March to cut production by 25,400 cars.

Rover Group is in talks with the European Commission over the discounts its sales dealers offer to buyers.

A practice of restricting dealers' discounts could violate EC rules on fair competition.

But an EC spokesman stressed that no formal charges had been issued and Rover had itself requested the talks.