Ailing German carmaker Volkswagen on Thursday declined a media report that it is planning to lay off up to 30,000 employees.

“One thing is clear: Volkswagen has to reduce its costs at its German locations,” a spokeswoman said. “This is the only way the brand can earn enough money for future investments.”

“How we achieve this goal together with the employee representatives is part of the upcoming talks,” she said,a adding that VW could not confirm the figure mentioned.

German business magazine Manager Magazin reported that the carmaker could cut up to 30,000 jobs in Germany in the medium term. In addition, CFO Arno Antlitz is planning to cut funds for investments over the next five years to €160 billion, according to the report.

VW had previously set its medium-term planning target for the period from 2025 to 2029 at €170 billion.

VW is struggling with high costs in its core brand, VW Passenger Cars.

The carmaker has terminated its decades-old job security agreement with unions in Germany, and plant closures and layoffs are on the table.

Brand chief executive Thomas Schäfer wants to raise the operating return to the target level of 6.5% in the coming years. Negotiations with trade union IG Metall begin next week.

According to Manager Magazin, the axe will be taken to the research and development departments in a bid to reduce costs.

Of the approximately 13,000 employees in those areas in Germany, some 4,000 to 6,000 will have to take their leave, according to some forecasts. Partial retirement and severance payments would not be sufficient to cover the numbers.

For years, investors have been criticizing VW’s spending on investments, saying that this also reduced financial leeway for dividends for shareholders.