VW cuts shift at German plant, freezes some hiring

Workers assemble engines at a Volkswagen plant in Germany in this file photo.

A Volkswagen engine factory said it has dropped one shift a week and the company's financial services division imposed a temporary hiring freeze as the world's largest automaker grapples with an emissions-rigging scandal.

The extent of the fallout from the scandal, which erupted Sept. 18 when the U.S. Environmental Protection Agency said VW had cheated on tests of its diesel cars, remains unclear as do the costs to Volkswagen. Longtime CEO Martin Winterkorn quit last week, but said he was aware of no wrongdoing on his part.

In Germany, Stella Pechmann, a spokeswoman for the engine plant in the city of Salzgitter, confirmed a report Wednesday in the Wolfsburger Allgemeine Zeitung daily that a "special shift" is being cut as a precaution because of the current situation. The shift had previously been added to deal with high demand.

Separately, the Volkswagen Financial Services division is freezing new hiring until the end of the year, though spokesman Stefan Voges told news agency dpa that existing hiring agreements are unaffected.

The scandal has raised concerns that the reputation of German automakers and engineering as a whole could be tarnished, though Finance Minister Wolfgang Schaeuble said he doesn't see the affair damaging Germany as a business location.

"We will emerge from this crisis stronger, too. We learn from crises," he was quoted as saying in an interview with the RedaktionsNetzwerk Deutschland group of newspapers. However, "in the end, VW will no longer be what it was - a lot will change there structurally."

Matthias Mueller, previously the CEO of the Porsche sports car unit, was appointed Friday to succeed Winterkorn. On Wednesday, Porsche appointed Oliver Blume - responsible for production and logistics at the division since 2013 - as its new chief executive.