Volkswagen AG's supervisory board will meet March 22 to mediate between the company's management and the head of its works council, as the parties appear to be divided over the German carmaker's cost-reduction plans, Reuters reported March 20, citing German-language magazine Der Spiegel and a participant at a recent staff gathering.

Bernd Osterloh, who is the head of the works council and is also a member of the supervisory board, reportedly said there could be a confrontation that would "paralyze the company for months" unless Volkswagen's management offered concessions on planned job cuts.

The luxury carmaker announced earlier this month that its namesake brand will slash up to 7,000 jobs as part of a five-year plan to save €5.9 billion annually. The company earlier said it has given its workforce a job security guarantee until at least 2025.

Osterloh demanded to extend the jobs guarantee to 2029 and to restaff all open positions, according to the report.

In addition, the report said Wolfgang Porsche, chairman of holding firm Porsche Automobil Holding SE, which controls Volkswagen, recently criticized what he described as rigid structures in Wolfsburg and demanded greater flexibility from Volkswagen workers to help CEO Herbert Diess overhaul the company.

Porsche is also a member of the carmaker's supervisory board.

A spokesman from Volkswagen told Reuters that he did not know of any planned board session.