Volkswagen staff resume strike action amid fears of plant closures

Thousands of employees downed tools for four hours in nine German plants as the car maker and its unions opened a new round of negotiations aimed at finding a resolution to the standoff.

Further industrial action has been taking place at Volkswagen in Germany as bosses and unions began a new round of negotiations over pay cuts and plant closures. The renewed negotiations are aimed at ending a standoff between the German car maker and its employees after the car giant rejected the latest proposal put forward by the unions. The unions said their proposal would save the car maker €1.5bn and included lowering dividend payouts and cutting some bonuses.

The company’s chief negotiator Arne Meiswinkel said that: “After intensive analysis, this counter-proposal is not sufficient for a sustainable solution.”

Volkswagen, struggling with poor demand in Europe and competition in China, is planning to make €10bn of savings. They are considering the unprecedented closure of plants in Germany, slashing thousands of jobs and cutting pay by 10%. The company argues that it must lower costs in Germany in order to preserve its competitiveness.

“Volkswagen AG still needs a cost reduction that can be implemented in the short term and has a lasting effect. This is the only way we can remain competitive in economically challenging times,” said the company in an email sent to Euronews Business.

They said that the company must reduce its excess capacity, and lower factory costs, including high labour costs.

But the unions doubt that these are the only cost cuttings that can help. Chief employee representative Daniela Cavallo said last week at the rally in Wolfsburg when almost 100,000 employees went on a warning strike: “We demand that all make their contribution – management and the shareholder side as well.”

The next round of talks this Monday “is likely to set the course – rapprochement or escalation”, she added. “We are ready for both.”

German Chancellor Olaf Scholz also joined the debate by calling on the car maker to hold off shutting down factories, Funke media group reported. Scholz acknowledged that it was up to the company and its staff representatives to discuss the matter.

The unions are threatening strikes in 2025 if there is no agreement.

Monday’s strike action brought thousands of workers out at nine German sites, with thousands gathering in Wolfsburg, near the headquarters of the car maker.

The chief negotiator of Volkswagen said before the talks: “We must succeed in identifying further potential. Only this will enable us to invest in a future-proof product portfolio up to the 2030s.”