Volkswagen is contemplating to divest its design and engineering unit, Italdesign, as part of its strategy to revamp European operations, reported Reuters, citing union representatives.
The German automaker is exploring options, including a sale or partnership for the Turin-based unit, according to union representatives from Italian Federation of Metalworkers (Fiom) and FIM Cisl after a meeting with Italdesign management.
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The move comes as Volkswagen faces increased competition and a challenging European car market.
Audi, which fully owns Italdesign, is reviewing its strategic alignment, including its holdings.
Audi’s spokesperson was quoted by the news agency as saying, the company “continuously reviews its strategic alignment, including its holdings.”
Italdesign employs approximately 1,350 people, with 1,100 based in Turin, and reported a turnover of $374m last year.
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By GlobalDataUnion representatives revealed that Volkswagen has received preliminary interest from four or five parties but is currently not considering offers from competitors or financial groups.
Rocco Cutrì, head of FIM Cisl union in Turin, mentioned that Audi is conducting preliminary due diligence at Italdesign to prepare for the plan.
Founded in 1968 by Giorgetto Giugiaro, Italdesign has created models for brands like Volkswagen, Fiat, Alfa Romeo, and Audi.
Volkswagen acquired Italdesign in 2010 and assumed full ownership in 2015.
Volkswagen recently announced significant changes to its German operations, including job cuts and capacity reductions.
The company ended Volkswagen-branded car production in Dresden and Osnabrueck and is exploring alternative uses for these plants.
Audi also closed its Brussels plant after failing to find a buyer.
Also, Volkswagen Group reported a mixed start to the fiscal year, with operating profit in Q1 FY2025 down 37% at €2.9bn, despite a 3% increase in sales revenue to €78bn and a 1% rise in unit sales to 2.1m vehicles.
