Volkswagen plans to shut at least three German plants, axe tens of thousands of jobs and slash pay by 10 per cent, the company’s top employee representative said on Monday.
The restructuring would mark the first closure of domestic plants in the company’s 87-year history and set up a battle with unions. Volkswagen has 10 plants and 300,000 employees in Germany.
It has warned that radical measures are needed as Europe’s largest carmaker faces intense competition in China, slowing sales across other major markets and the need to navigate the costly transition to electric vehicles.
It recently issued its second profit warning in three months, blaming a “challenging market environment”.
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Volkswagen on Monday said it would not comment on “speculation about the confidential talks with [the union] IG Metall and the works council”, adding that the company was at a “crucial point”.
The company’s works council represents VW employees and holds half the seats on the supervisory board.
Daniela Cavallo, the head of Volkswagen’s works council, told employees gathered at the company’s main Wolfsburg plant that executives had two days to reverse its plans, as she hinted at future strikes.
She said chief executive Oliver Blume was “playing with the massive risk that...we will break off the talks and do what a workforce has to do when it fears for its existence”. - Copyright The Financial Times Limited 2024
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