According to two sources close to the company, Volkswagen's supervisory board will convene on Tuesday to discuss a proposed cost-cutting initiative ahead of its capital markets day on June 21.

One source told Reuters the board will meet to discuss cost-cutting measures, which will amount to a minimum of $3.22 billion across various brands like Volkswagen, Seat, Skoda, and Cupra.

German business newspaper, Handelsblatt, reports CEO Oliver Blume wants to optimize German plants and reduce duplicate development work, particularly at Audi and Volkswagen, as part of the savings program.

“The focus of the Capital Markets Day is on the power of the brands and the Group management model,” a Volkswagen spokesperson said in an emailed statement to Reuters. The source did not give further detail, according to Reuters.

In May, Arno Antlitz, the finance chief of Volkswagen, told Reuters the company would give investors an update on financial targets and capital allocation plans during the June capital markets day.

In May, Volkswagen brand chief Thomas Schaefer revealed in an internal memo that the brand set a goal of a 6.5% return on sales, up from the 3% achieved in Q1 of this year.

“Pressure is mounting. The Volkswagen brand must act,” he wrote in this memo.