(Bloomberg) -- Volkswagen AG’s premium brand Audi has failed to find a suitable investor for its troubled electric-vehicle factory in Brussels, raising the risk that the plant could close.
None of the 26 interested parties and potential investors — including one that revised a pitch in recent days — has offered a “viable and sustainable concept” for the future of the factory, Chief Operating Officer Gerd Walker said Tuesday in a statement following an extraordinary works council meeting. An internal search within VW for future car production or alternative uses for the plant also came up empty-handed, the brand said.
“It is important to me that we quickly create clarity in the information and consultation process and now focus further on the social plan discussions,” Walker said. “We will continue to pursue this in a trusting, objective and fair manner.”
It’s likely that the 3,000 or so factory workers will lose their jobs, said Ronny Liedts, a negotiator for the ACV-CSC union at the plant. “The only thing they want to do is close the plant as quickly as possible. None of the alternatives work for them,” he said.
Audi’s high-cost Brussels site could become the first VW plant to close in Europe. It’s struggled due to poor demand for an electric SUV made there, while the factory’s central location has hindered its expansion and logistics updates to make the site more economical.
Audi isn’t the only VW brand under pressure. Sluggish EV demand, a lack of affordable models and tech-savvy rivals like Tesla Inc. and BYD Co. have pushed Europe’s largest carmaker into one of its most intense cost-cutting programs in years. VW’s massive production overcapacity at its German sites have forced its namesake brand to mull German factory closures for the first time in its 87-year history, and to remove three decades of job security agreements with employees.
Belgian law dictates that local plant managers and workers hold talks about the future of any site in danger of closing. Representatives from Audi and the labor side have reviewed alternative options to keep the plant in operation, but none has proved to be economically viable.
Audi is restructuring several divisions to speed up decision-making and launch new models more quickly. It’s also pushing ahead with plans to participate in Formula 1 racing starting in 2026.
(Updates with union response, details on Brussels site, VW cost-cutting efforts.)
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