Worker unions threatened industrial action if VW persists with drastic plans amid high manufacturing costs and competition, while VW claims proposed m
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Volkswagen on Friday rejected as unrealistic a union proposal to make cost cuts at the carmaker’s German operations without having to close factories, sparking anger from worker representatives as strikes loom.
The crisis-wracked auto titan has been locked in bitter talks with unions since announcing in September that it was mulling the unprecedented step of shuttering plants in Germany.
The powerful IG Metall union has indicated industrial action could start from December 1 if Volkswagen does not withdraw the drastic plans.
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VW has been hit hard by high manufacturing costs at home, a stuttering shift to electric vehicles and tough competition in key market China.
Ahead of the latest round of talks last week, the union and VW’s works councils put forward a series of proposals they said would save 1.5 billion euros ($1.6 billion) in labor costs without the need for site closures.
These included proposals for management and staff to waive bonuses. The union also said it could drop a demand for pay rises in exchange for working shorter hours at some factories.
But Volkswagen said it had concluded that, while the measures could help in the short term, they would not lead “to any long-term financial relief for the company in the coming years”.
“A sustainable saving of 1.5 billion euros cannot be determined even after intensive analysis,” said the group, whose brands range from Audi to Skoda and Seat, in a statement.
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IG Metall described VW’s response as “extremely regrettable”, accusing it of “ignoring the constructive proposals of the employee representatives”.
VW was continuing to insist on “extreme positions”, a union spokesperson said, adding that the automaker “has yet to answer the question of what steps it is willing to take to meet the employees halfway”.
Worker representatives say at least three VW plants are at risk of closure in Germany and tens of thousands of jobs could go, with remaining employees facing hefty pay cuts.
The two sides are set for fresh talks on December 9.
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First Published Date: 30 Nov 2024, 08:35 AM IST
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