Volkswagen's chief executive welcomed a deal to slash jobs and reduce production capacity in Germany without the need to close factories, but the car giant's shares fell heavily on Monday.

Volkswagen shares were down 3% in early trade on Monday with analysts citing uncertainty about the automaker's cost-cutting deal with unions and likely headwinds in 2025.

Volkswagen announced sweeping changes to its German operations, including more than 35,000 future job cuts and capacity reductions in a last gasp deal between Europe’s top carmaker and unions on Friday to avert mass strikes.