Volkswagen has announced that its plan to make a massive job cut that would affect 30,000 positions. About 23,000 of the affected jobs are thought to be based in Germany.

The company aims to renew its core brand and create a new set of self-driving and electric vehicles. VW recently suffered from an emission cheating scandal.

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The German automobile company has also announced that it is creating 9,000 jobs in connection with its new products.The decision to cut 30,000 jobs is expected to result in $3.92 billion worth of savings by 2020. This is considered as "the biggest modernization programme in the history of the group's core brand."

Matthias Mueller, chief executive of VW, said that "the VW brand needs a real shake-up and that is exactly what the future pact has turned out to be."

The move that will lead the company to a "path of profitable growth" was signed by the Board of Management and General Works Council. It aims at improving the VW's "economic viability and competitiveness." General Works Council Chairman Bernd Osterloh added that "the new cars based on the Modular Electric Drive Kit and electric components from our plants will make our German locations pioneers of electrification within the Volkswagen Group."  

Volkswagen has approximately 610,000 employees from 31 nations. It aims to a achieve profit inflation from two percent to four percent. To make this possible, the company's German plants have to increase their productivity by 25 percent. A fifth of Volkswagen's 120,000 employees in Germany are expected to get trimmed down with the 30,000 job cuts. Despite this, protests in the Wolfsburg town are not anticipated as employees who will lose their jobs will simply be transferred to new posts. 

Osterloh said that "the next generation of electric vehicles will be made here in Germany, not abroad." VW group is composed of 12 brands including Audi, Skoda, Seat, Bentley, Bugatti, Porsche, Lamborghini, Ducati, Scania, MAN as well as Volkswagen passenger cars and commercial vehicles.