VW Chairman says EU must do more to help ailing car industry

Volkswagen AG Chairman Hans Dieter Pötsch urged the European Union to alter its emissions targets and provide clarity to the car industry as the automaker eyes job cuts and unprecedented factory closures in Germany.

The VW veteran, who has close ties to the Porsche-Piëch owner family, said policymakers have set tough climate ambitions but haven’t fully thought through the steps needed to get to that point. Targets must be “adapted to reality" to give the industry more time.

“Electric mobility is the future of individual mobility but, and I can’t emphasise this enough, politicians have given the industry targets without the necessary infrastructure being available, and without considering whether customers are along for the ride," Pötsch said Wednesday at an event in Vienna.

Pötsch is overseeing VW at a time of upheaval for the German car industry, which is struggling with high costs and tougher competition from Tesla Inc. and Chinese carmakers led by BYD Co. VW on Tuesday scrapped three-decades-old job protections in Germany after last week warning it may have to shutter plants in Europe’s biggest economy for the first time.

Talks with labor representatives and unions, who hold unusually strong sway at VW, could potentially last until the end of the year, Pötsch said on the sidelines of the event.

“During this phase of the process, it’s really important to convince people that there’s no way around structural changes," he said.

The EU “must now create the conditions for the success of electromobility in terms of power grids, charging, raw materials, vehicles and investment support," he said.

The decision to end job security agreements sets VW up for lengthy clashes with labor representatives. Cutbacks at the Wolfsburg-based company are harder to push through than elsewhere. Half the seats on its supervisory board are held by labor representatives, and the German state of Lower Saxony — which owns a 20 per cent stake — often sides with trade union bodies.

In his remarks, Pötsch said the car sector needs “innovative, competitive products and strong cooperation from politics, business and society."

“Other regions of the world are successfully setting an example for us," he said. “Protectionism and isolation will not help."

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That was echoed by Renault SA Chief Executive Officer Luca de Meo, who said carmakers should partner with Chinese firms and learn from them.

An industrial engineer from Austria, Pötsch also is the CEO of Porsche SE, the Porsche-Piëch clan’s investment vehicle. He gained the trust of the family by negotiating a successful conclusion to a years-long takeover saga that saw VW gain control of luxury-car maker Porsche in 2012.

Pötsch joined VW as its finance chief in 2003 after stints as CEO of Duerr AG and chief controller at BMW. He’s been VW’s chairman since 2015.

“The e-mobility trend will prevail," Pötsch said. “But it will take more time."

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