VW to pay employee bonus as per 2002

Volkswagen AG has said it intends to pay a bonus to employees of €1,550, the same level as for 2002, despite the slump in profits last year and the dividend cut.

Klaus Volkert, VW works council head and supervisory board member said: "Despite an extremely disappointing year in 2003, we managed to agree an employee bonus of €1,550 at a works meeting here."

Volkert warned that 2004 will be more difficult than 2003, saying that the financing and earnings power of VW is getting weaker.

He also said that there are price and competitive pressures from the market.

VW announced at the beginning of March plans to slash costs by €4bn and cut 5,000 jobs by end 2005.

Volkert reiterated that VW does not plan to close any factories.