Volkswagen workers in Germany reportedly want more to be spent on local production and a new model to build in the country.
According to Reuters, its powerful labour unions have called on the company to create more work for German plants by increasing investment and creating a new model.
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The unions are concerned that a 3.8% drop in VW's vehicle production in Germany in the first half of the year, due to falling demand for the current Golf and Passat models, could lead to further cuts in high-cost production capacity at home.
VW last November had agreed with German unions to cut thousands of jobs at the core VW brand through natural attrition over the next eight years, in exchange for a commitment to avoid compulsory redundancies.
The unions and management earlier this year resolved a dispute over how to implement a turnaround plan for the troubled VW brand but the company still has to come up with a multi-billion-euro investment plan by November, Reuters noted.
"The works council views with great concern that the current budget round at VW is not making any headway," VW works council chief Bernd Osterloh told Reuters, criticising a failure by management to yet say how it plans to use its German production capacity.
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By GlobalData"That is completely incomprehensible because a high capacity utilisation of German plants is crucial for the success of the company and the jointly agreed future pact."
Osterloh, a member of VW's supervisory board, called for production of a new model to be assigned to Wolfsburg, Emden or Zwickau.
Separately, management should overhaul assembly lines at Wolfsburg, VW's core plant employing over 60,000 people and grappling with low demand for the ageing Golf, to be able to service demand for an extra 40,000 Tiguan sport-utility vehicles (SUVs), the carmaker's most popular model at present, Osterloh told Reuters.
Wolfsburg already will build a new SUV model for Seat in 2018, using the VW group's cost-saving MQB modular platform on which the Tiguan and Golf are based.
"Only by means of a high capacity utilisation can we achieve the productivity targets," Osterloh told Reuters.
"The issues raised here are relevant and currently under discussion," a VW spokesman told Reuters, declining to elaborate.
The report said VW plans to raise productivity at its German factories by 7.5% this year and next, and a further 5% in 2019 and 2020, counting on making cuts to fixed costs and tweaking its R&D, procurement and production operations.
Investors have said a turnaround at the VW brand is key to reviving the group's fortunes following the costly diesel emissions test-cheating scandal.
Osterloh told Reuters the carmaker had earmarked another EUR500m (US$587m) in cost savings on top of the EUR1.5bn of efficiency gains already budgeted for this year, without providing details.
The savings are sustainable and stem from rationalising the range of engines and parts it offers, cutting costs on vehicle and component tests and streamlining work processes, a company source told Reuters.
