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“Just Transition at Volkswagen Group” 7th ESG Conference Volkswagen Group 07.05.2025 DR. THYMIAN BUSSEMER HEAD OF HR STRATEGY & INNOVATION VOLKSWAGEN GROUP
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2 Disclaimer The following presentations as well as remarks/comments and explanations in this context contain forward- looking statements on the business development of the Volkswagen Group. These statements are based on assumptions relating to the development of the economic, political and legal environment in individual countries, economic regions and markets, and in particular for the automotive industry, which we have made on the basis of the information available to us and which we consider to be realistic at the time of going to press. The estimates given entail a degree of risk, and actual developments may differ from those forecast. All figures are rounded, so minor discrepancies may arise from addition of these amounts. Any changes in significant parameters relating to our key sales markets, or any significant shifts in exchange rates, energy and other commodities or the supply with parts relevant to the Volkswagen Group will have a corresponding effect on the development of our business. In addition, there may also be departures from our expected business development if the assessments of the factors influencing sustainable value enhancement and of risks and opportunities presented develop in a way other than we are currently expecting, or if additional risks and opportunities or other factors emerge that affect the development of our business. We do not update forward-looking statements retrospectively. Such statements are valid on the date of publication and can be superseded. This information does not constitute an offer to exchange or sell or an offer to exchange or buy any securities.
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Automotive industry with significant impact on European economy Source: Institut der deutschen Wirtschaft, 2024; Annual report VDA 2023, Statistisches Bundesamt Contribution to Gross Domestic Product (GDP) 7% 13% Proportion of working-age people who are employed in the automotive industry 4.5% (13bn) 2.2% (1.14bn) Europe Germany *Figures are rounded Base: 2023 incl. suppliers 7th ESG Conference Volkswagen Group - Dr. Thymian Bussemer 07.05.2025
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1990 2024 Volkswagen Group has significantly contributed to the creation of well-payed and future-proof jobs – in Germany and beyond 679.472 295.000 388.000 Total workforce Workforce in Germany Workforce outside Germany 257.930 165.711 92.219 Total workforce Workforce in Germany Workforce outside Germany Source: Volkswagen Group annual reports 7th ESG Conference Volkswagen Group - Dr. Thymian Bussemer 07.05.2025
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The future of jobs: Germany’s automotive industry has reached its peak of employment in 2018 Source: Study by Ernst & Young: „Die Automobilindustrie in Deutschland“ (March 2025) 731 2006 723 2009 756 2013 808 2016 834 2018 809 2020 774 2022 773 2024 Turnover in bil. EUR Employees in tsd. 404.6 307.7 263.1 361.6 426.2 378.2 506.2 536.1 7th ESG Conference Volkswagen Group - Dr. Thymian Bussemer 07.05.2025
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The rearrangement of the automotive world in times of geopolitics: continental plate shift with unforeseeable outcome 7th ESG Conference Volkswagen Group - Dr. Thymian Bussemer 07.05.2025
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Shanghai Motor Show, April 2025: tipping point or only top of the iceberg? Source: Shanghai Government 7th ESG Conference Volkswagen Group - Dr. Thymian Bussemer 07.05.2025
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Concerns about the German automotive industry and its workforce: lay-offs and skill shortage simultaneously 06.03.2025 7th ESG Conference Volkswagen Group - Dr. Thymian Bussemer 07.05.2025
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Trend 1: The current shift towards BEVs brings a new push in the decline of work volume in our factories Vehicle production in mix ICE & BEV Gearbox in mix ICE & BEV Electric powertrain vs. ICE powertrain Source: Fraunhofer IAO Decrease in % Support and enable people in shifting jobs Provide meaning for work- force in traditional fields - 12 % - 70 %- 60 % 7th ESG Conference Volkswagen Group - Dr. Thymian Bussemer 07.05.2025
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Proportion of qualified vs. non-qualified labor in coachbuilding in % (plant Wolfsburg) Trend 2: Importance of knowledge work in automotive is massively increasing 0 200 400 600 800 1000 1200 2005 2010 2015 2020 2025 0 2 4 6 8 10 0 25 50 75 100 125 150 175 7.90% 2018 8.16% 2019 8.85% 2020 110.9 114.9 115.1 R&D cost per car in % Total R&D expenditures Source: Statista Software as central enabler of future’s passenger car/lines of code per model [in mio] R&D expenditures in the automotive industry [in bn €] 5 20 25 44 47 52 59 95 80 75 56 53 48 41 0 10 20 30 40 50 60 70 80 90 100 Golf I 1983 Golf II 1974 Golf II 1991 Golf IV 1997 Golf V 2003 Golf VI 2008 Golf VII 2015 Qualified work Unqualified work Source: Volkswagen Group internal 7th ESG Conference Volkswagen Group - Dr. Thymian Bussemer 07.05.2025
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Managing workforce transformation in all its parallelism is a central strategic objective of Volkswagen for the next decade Product strategy affects needed skills and quantity of work Workforce faces a combination of restructuring, relocation and digitalization of work Effective management of wages in the transformation essential Restructuring programs Software driven products MaaS & TaaS ICE BEV Roadmap: Digital Transformation Source: Volkswagen Group annual reports Annual labor costs Volkswagen Group 2023 (in bn. €) Turnover Volkswagen Group Labour costs 322.3 49.7 15.5% Source: Volkswagen Group annual reports 7th ESG Conference Volkswagen Group - Dr. Thymian Bussemer 07.05.2025
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Volkswagen addresses the workforce transformation with a holistic people strategy Functional Department Strategy Focus on HR #functionally centered #KPI based #linear Focus on People & Business #human centered #data oriented #holistic People Strategy 7th ESG Conference Volkswagen Group - Dr. Thymian Bussemer 07.05.2025
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Volkswagen Group People Strategy: high level targets Aligned with society & environment Excellent employee experience Outstanding culture Best performing teams & exemplary leadership Me@VW Group Teams@VW Group All of Us@VW Group We@VW Group and the world around us 07.05.20257th ESG Conference Volkswagen Group - Dr. Thymian Bussemer
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“Just Transition” at Volkswagen: Managing the change from “old” to “new” since 9 years Transition from traditional industrial occupations to tech-enabled knowledge-work 2016 2019 2025 Roadmap: Digitale Transformation Brand VW PKW • Securing employment Until 2029 • Strengthening training & qualification: 160 mil. EUR between 2019 - 2023 to enhance training and qualification. • Establishing 2,000 new IT positions by 2023 and investing approx. 4 billion EUR in digitalization. • Socially responsible job cuts: Reducing 4,000 positions in a socially responsible manner • Increasing flexibility in personnel deployment across departments and locations. • Creation of new jobs: 9,000 new jobs created in future-oriented areas. • Socially responsible job cuts: Up to 30,000 jobs worldwide, mainly through partial retirement and qualification offers. • Investment in future technologies: Around 3.5 billion euros invested in electromobility and new services. Source: Press releases Volkswagen 7th ESG Conference Volkswagen Group - Dr. Thymian Bussemer 07.05.2025
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Instruments for socially responsible headcount reduction Use of the demographic curve & hiring freeze Termination agreements Partial retirement agreements Reduction of appren- ticeships, consequently flattening of inflow 7th ESG Conference Volkswagen Group - Dr. Thymian Bussemer 07.05.2025 Headcount reduction in line with the agreed program targets ~35.000 FTE by 2030
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The Volkswagen Group Academy as central driver for re- and upskilling at Volkswagen AG In 2024, the Volkswagen Group trained 17,201 apprentices in 30 professions and over 20 dual study programs • 5 Academy Directors of 6 Academies • 600 Employees • 4.000 Apprentices/ Dual Students in VWAG Group Learning Strategy AREAS OF RESPONSIBILITY Vocational Education Technical TrainingLearning Ecosystem Mgmt. Training Group Lean Center Culture & Change Volkswagen Group Academy Source: K-SE 7th ESG Conference Volkswagen Group - Dr. Thymian Bussemer 07.05.2025
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Apprenticeship 2.0: Shift from training in traditional professions to future-proof jobs New apprenticeship professions New study programs 7th ESG Conference Volkswagen Group - Dr. Thymian Bussemer 07.05.2025
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Example for systematic re-skilling of traditional professions: from skilled metal worker to vehicle IT specialist 5/8/2025 17 191 Days HV-/Gas Technology and safety Setup of the required hardware and software for the commissioning of vehicles Safe handling of vehicle systems Flashing of control devices Vehicle diagnostics ca.- 24 Month106 Days „Inbetriebnehmer Fahrzeugtechnik“ Commissioner 85 Qualification days Parameteri- zation and co- ding of the SG Basics motor vehicle Basics automotive electrics / electronics Error diagnostics in the vehicle Skilled worker metal „Fahrzeuginformatiker“ Vehicle Computer Scientist min. 15 to max. 18 months of qualification „Operativer Datenlogistiker“ Operational data logistician (curriculum in process) „Experte für Fahrzeug- elektronik“ Expert for vehicle electronics (curriculum in process) „VW Automobilmechatroniker“ automotive mechatronics 106 Qualification days 7th ESG Conference Volkswagen Group - Dr. Thymian Bussemer 07.05.2025
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WEB APP MOBILE LEARNING EXPERIENCE PERSONALIZED LEARNING ENVIRONMENT JOB- / SKILL-ORIENTED Open Resources Metadata VW Content Business Area Shops Customized digital learning ecosystem for various job families at Volkswagen Platform Content Metadata 7th ESG Conference Volkswagen Group - Dr. Thymian Bussemer 07.05.2025
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42 Wolfsburg & Berlin: New ways in the training of IT specialists 37% of former students hold a permanent position in the automotive sector 26% at VW software suppliers (e.g. T-Systems, Capgemini, ETAS..) 11% within the Volkswagen Group Source: K-SE Year School utilization in % Students Wolfsburg Berlin Permanent positions 7th ESG Conference Volkswagen Group - Dr. Thymian Bussemer 07.05.2025
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Summary With innovative reskilling concepts, we are enabling our employees to make easier transitions from direct to indirect during the transformation process We are developing new apprenticeship schemes to create future professions for the automotive industry The decline in employment in the automotive industry in Germany and Europe will continue, the extent of which also depends on the framework conditions We are shaping the workforce transformation in a socially responsible way We will remain a magnet for talents from a wide range of disciplines Source: Beschäftigungsperspektiven in der Automobilindustrie (prognos) 7th ESG Conference Volkswagen Group - Dr. Thymian Bussemer 07.05.2025