Volkswagen is to end its Auto 5000 project, which was launched seven years ago, and reintegrate the 4,200 employees of the subsidiary into the group, allowing it to make more flexible use of employees in the production of different models.

The Auto 5000 workers will from now on be paid in accordance with the group's collective pay agreement, which means that they will receive slightly more pay, Financial Times Deutschland reported. Negotiations are expected to be completed by 14 November.

The project was originally established to prevent the transfer of production to cheaper locations overseas

VW instead took on 5,000 new staff at salaries that were DM5,000 lower than those provided by the collective pay agreement but managers have repeatedly complained about the lack of flexibility at the group.