Revving up: Volkswagen group rolls out VRS for production site workers

Skoda Auto Volkswagen India says it has introduced a voluntary retirement scheme at its Pune and Chhatrapati Sambhaji Nagar plants after union requests

Skoda Auto Volkswagen India Private Ltd (SAVWIPL), which operates two manufacturing plants in Pune and Chhatrapati Sambhaji Nagar (erstwhile Aurangabad), has rolled out a voluntary retirement scheme (VRS) for employees who are considering retirement or other career opportunities.

 

Claiming that the scheme is ‘entirely voluntary’, an SAVWIPL spokesperson told Business Standard: “Based on requests from the union over the past couple of years, and following constructive discussions with the union committees, SAVWIPL has introduced a VRS to support employees who are considering retirement or exploring other career opportunities.”

 

He added, “The scheme is entirely voluntary, underscoring our commitment to employee welfare and social responsibility.” 

These two factories in Maharashtra make cars, including the Skoda Kushaq, Audi Q3 and Q5 and Volkswagen Virtus, for both the India market and exports. 

In November, SAVWIPL crossed a 2 million mark in local vehicle production after 25 years of operations in the country. The two plants combined have a capacity to produce close to 320,000 units annually.

 

While the deadline for accepting the VRS is not known, a Reuters report quoting sources claimed that the scheme offers employees 75 days of pay for each year served or each year remaining until retirement — whichever is lower. Those who sign up within five to 10 days will get an additional payout.

 

“The workers’ unions had approached the company to consider a VRS for some people who intended to retire or pursue other career interests, and this is not recent. It was happening for the past couple of years, but it took time for taking the necessary approvals as it involves a large payout,” said a group-level source.

 

“We are not intending to wrap up or shut down any operations here in India where we are on a growth path. Combining blue-collar and white-collar workers, the group has around 5,000 employees in India,” the person said.

 

The MQB-Ao-IN platform, developed specifically for India by local engineering teams, has been a major driving force. More than 500,000 vehicles have been produced on this platform, which underpins the Skoda Kushaq, Slavia, Kylaq and the Volkswagen Taigun and Virtus. The last 500,000 units were rolled out in just three-and-a-half years.

 

Data from the Federation of Automobile Dealers Associations (Fada) showed that in the first 11 months of the calendar year, SAVWIPL has retailed 94021 units, marking a 28.8 per cent growth. For April-November of the financial year, retail sales grew by 33 per cent year-on-year (Y-o-Y), riding on the success of its new SUV Kylaq and the Volkswagen Virtus sedan.

 

The group’s retail market share has grown from 1.8 per cent in November 2024 to 2.34 per cent in November this year. In the festival month of October, the group’s retail sales grew by 35 per cent, followed by a 55 per cent Y-o-Y growth in November.

 

SAVWIPL manages the operations of six group brands in India — Skoda, Volkswagen, Audi, Porsche, Lamborghini and Bentley. Volkswagen group is also contesting a $1.4 billion import tax demand for allegedly evading levies in India.