Agreement reached in wage dispute VW wants to cut more than 35,000 jobs by 2030 - but no factory closures

IG Metall and Volkswagen have completed a historic negotiation marathon. An agreement was reached shortly before Christmas - with painful cuts.

DPA

20.12.2024, 19:18

dpa

Volkswagen plans to cut more than 35,000 jobs by 2030. The cutbacks are to be carried out in a socially responsible manner, the Group announced in Berlin. The decision is part of an agreement reached by the car manufacturer and IG Metall after days of negotiations.

"We had three priorities in the negotiations: Reduce overcapacity at the German sites, cut labor costs and reduce development costs to a competitive level," said VW brand boss Thomas Schäfer. "We have achieved viable solutions for all three issues."

The car manufacturer will reduce technical capacity at the German sites by over 700,000 vehicles. "These are tough decisions, but they also set an important course for the future." This will create the basis for Volkswagen to become the technologically leading volume manufacturer by 2030.

IG Metall chief negotiator Thorsten Gröger spoke of painful cuts. The union emphasized that plant closures and compulsory redundancies had been averted. "No site will be closed, no one will be made redundant and our company wage agreement will be secured for the long term," said Daniela Cavallo, Chairwoman of the General Works Council. There are concessions in the wage agreement, but also new job security until the end of 2030.

Longest collective bargaining round ever at VW

The agreement was reached after a marathon session: representatives of Volkswagen and IG Metall had been struggling to reach a compromise in Hanover since Monday, with some negotiations lasting until the morning. In total, the talks lasted more than 70 hours. According to IG Metall, it was the longest round of collective bargaining ever at Volkswagen.

Several days were set aside for the last round of negotiations before Christmas because both sides wanted to reach an agreement before the holidays. Around 70 representatives from the company and the union were accommodated in a hotel in Hanover for the fifth round of negotiations.

Plant closures as a "red line"

As recently as Wednesday, participants had spoken of widely divergent positions. Until the end, the main points of contention were the plant closures and compulsory redundancies brought into play by VW. IG Metall had described both as "red lines" that should not be crossed. The union also rejected the across-the-board wage cut of ten percent demanded by VW.

In addition, VW wanted to take on fewer trainees and reduce the pay of temporary workers, who previously received a supplement at VW, to the normal level of temporary work. VW justified the requested cuts with high costs and low capacity utilization at its plants.

Employment guarantee canceled

Instead, IG Metall demanded the retention of all ten locations in Germany as well as an employment guarantee for the approximately 130,000 employees. The previous employment guarantee, which ruled out redundancies for more than 30 years, was terminated by VW in September.

Since the beginning of December, IG Metall has twice covered the car company with nationwide warning strikes. According to the union, around 100,000 employees at nine locations took part both times.