The Volkswagen automobile group has clarified its restructuring plans for its main brand, VW, with salary reductions and factory closures in order to save 4 billion euros (3.8 billion francs), the press reported on Monday German. “The board of directors wants to close at least three VW factories in Germany,” said the chairwoman of the group’s works council Daniela Cavallo at an information meeting for staff in Wolfsburg. All remaining sites should further be reduced,” she added. Savings proposals within VW management would also include a 10% pay cut, as well as salary freezes for the years 2025 and 2026, according to the business daily Handelsblattwhich is based on several sources internal to the group.
These leaks come as the works council, under the leadership of its president Daniela Cavallo, simultaneously organizes information meetings on Monday in all VW factories in Germany. According to Handelsblatt, management would also like to reduce bonuses reserved for the highest salary bracket as well as bonuses linked to seniority anniversaries. In addition, several scenarios for closing VW sites in Germany would be considered, without further details at this stage.
Possible strikes
The automobile giant, which has 120,000 employees in Germany, caused a shock wave at the beginning of September by announcing its plan to close factories in Germany and carry out possible layoffs, in the process repealing the agreement on the guarantee of employment in force for thirty years for German employees.
Employee representatives, who have co-decision power over the company’s strategy, are committed to fighting these plans. VW will begin the second round of negotiations on a new “in-house” collective agreement with the IG Metall union on Wednesday.
The union is demanding a 7% salary increase and better pay for apprentices, demands which remain far from the views of management. Strikes are possible at Germany’s largest industrial employer after the mandatory social dialogue period, from December.
