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Volkswagen lays off 500 Chattanooga workers

The redesigned Volkswagen Passat has been a decent seller since its debut in 2011, but sales have apparently dropped off enough that the automaker is trimming some of the employees from its Chattanooga, TN assembly plant. According to Automotive News, Volkswagen will be cutting shifts and laying off 500 contracted workers in response to slowing sales.
Currently, the plant has three teams running 10-hour shifts Monday through Saturday, but starting May 13, this will be reduced down to two teams running 10-hour shifts Monday through Thursday. This will be done to reduce dealer inventory (the article says that VW dealers, on average, have a 97-day supply of Passats) and production capacity (currently running at an annual pace of 170,000 units, which is more than the 150,000 annual units the plant was planned to produce).
This, of course, isn't saying that the Passat has been a failure since VW added 200 full-time employees to the plant in February 2012 to keep up with increased demand. The AN article says that automakers frequently overstaff plants during the launch of a new product - or in this case, a new product and a new plant - but eventually reduce the workers as things run smoother and more efficiently.

Porsche board members facing another ˆ1.8B lawsuit over VW takeover bid

Back in 2008, Porsche got the bright idea that it could take over Volkswagen in the midst of the worst economic slump since the Great Depression. Ignoring that this was a catastrophic move for the Stuttgart sports car manufacturer that that eventually resulted in it nearly going bankrupt and eventually being taken over by the same company it sought to control, the aftermath has left Porsche Chairman Wolfgang Porsche and board member Ferdinand Piëch in the crosshairs of seven hedge funds that lost out during the takeover and are now seeking €1.8 billion - $2.43 billion US - in damages from the two execs, according to the BBC.
See, investors bet on Volkswagen's share price going down, partially because Porsche said it wasn't going to attempt a takeover. But Porsche was attempting to take over VW, having bought up nearly 75-percent of VW's publicly traded shares. When word broke that Porsche owned nearly three-quarters of VW (which indicated an imminent takeover attempt), rather than go down like the hedge funds bet it would, VW's share price skyrocketed to over 1,000 euros per share, according to Reuters.
Naturally, when you bet that a company's share price is going to drop and it in turn (temporarily) becomes the world's most valuable company, you lose a lot of money, unless you're able to buy up shares before prices jump too much. This led to a squeeze on the stock, which the hedge funds accuse Porsche and Piëch (who are both members of the Porsche family and supervisory board) of organizing.

VW recalling 2.64M vehicles worldwide over engine, light issues

Volkswagen is staging a massive, worldwide recall that's already grown from 1.68 million to 2.64 million vehicles and covers three different issues across a number of vehicles. We already reported on 61,000 Tiguans getting recalled over lighting issues - that was just in the US. Globally, however, VW will be recalling 800,000 Tiguans, according to Automotive News, with the focus on CUVs built between 2008 and 2011. The issue with the Tiguan relates to a simple fuse swap, so this is rather unremarkable, aside from the sheer number of vehicles being fixed. The real, troubling issues relate to gearboxes and pickups.
239,000 Amarok pickups (pictured right) are being recalled over fuel leaks, while 1.6 million vehicles are being recalled to swap the synthetic oil in dual-clutch transmissions with mineral oil. Now, the transmission issue is one for the global Volkswagen Group to address, not just the VW brand - vehicles from Audi, Škoda and Seat use the same seven-speed DSG and are covered under the recall, as well.
Why the switch from synthetic to mineral oil? Apparently, using the synthetic oil in a DSG and then subjecting it to stop-and-go conditions or heavy loads in a hot and humid climate can lead to electronic malfunctions, according to a Volkswagen press release. The switch, from the sounds of it, is largely a preventative measure.