Volkswagen is to cut its workforce by 30,000 over the next five years as it acts to reduce costs following the diesel emissions scandal.

The German carmaker said it was committed to no compulsory redundancies under the union deal, with 23,000 of the positions to go at factories in its home market and the rest in North America and Brazil.

VW is preparing for a 2020 relaunch as part of its efforts to move past the damage done by its emission test rigging.

PA

In a news conference at the firm's Wolfsburg headquarters, VW brand chief Herbert Diess said: "I am very sorry for those affected, but the situation of the brand at the moment gives us little room for manoeuvre."

It has already set aside €18bn to cover costs associated with 'dieselgate,' with the bulk of them in the US where the company has agreed a massive $15bn compensation and vehicle buy-back package.

It has pledged to fix all affected vehicles in Europe, including 1.2 million in the UK, by this time next year.

VW confirmed workers at the group's other brands including Audi, SEAT and Skoda were not affected by Friday's announcement.

It said the future plan for VW would focus on new electric car technology - paid for through annual savings of €3.7bn.

The bulk of the job losses would be achieved, VW said, through not replacing retirees, temporary workers or those leaving for new positions.

The company added that it was creating 9,000 new positions through its focus on new technology, which aimed to deliver 30 electric models by 2025.

It hopes the marked shift from traditional fuel-powered vehicles will help steal a march on rivals amid continued debate over the use of diesel - once hailed as the greener alternative to unleaded but now linked to thousands of deaths across the EU each year.

The emissions crisis hit VW sales - 10% down in the UK alone in the 12 months after it emerged - with the company reporting its first financial loss in over two decades last year.

IRN