The Volkswagen automobile group will cut more than 35,000 jobs in Germany until 2030 and reduce the technical capacity of its factories, but will keep them all open after reaching an agreement with the IG Metall union.
The reduction in jobs will be carried out in a “socially acceptable” way and will allow it to save about 1.5 billion euros annually in labor costs, as reported by the company this Friday in a statement.
For its part, the technical capacity for the factories will be reduced to about 734,000 vehicles per year, which would represent almost the entire volume of its Wolfsburg home page, to adapt “to the declining car market in Europe and increasingly competitive competition.” intense.”
The agreement avoids the closure of plants, but includes specific adjustment measures for the majority of passenger car factories in the country.
For Osnabrück, the company is examining “options for alternative use”, although it will continue to manufacture the T-Roc convertible until mid-2027; while in Dresden alternative options will be developed when vehicle production ceases at the end of 2025.
Read: Volkswagen plans to eliminate more than 10,000 jobs in the coming years
In Wolfsburg, production will go from four assembly lines to two, while in the field of technical development a restructuring will be carried out and around 4,000 jobs will be eliminated by 2030.
In Emben, production will be ensured with the ID.7 Sedan, ID.7 Tourer and ID.4 models after “the facelift”, while in Zwickau production will focus on a single line from 2027.
In the area of commercial vehicles, with a factory in Hannover, concrete measures will be implemented to reduce costs; while in the area of group components, the company plans to save about 3,000 million euros until 2030 through the reduction of about 500 million euros in annual labor costs.
The employment guarantee returns
According to the IG Metall union, the agreement will reintroduce the guarantee that protects workers against dismissal for company reasons until 2030, after this was eliminated in September.
Regarding salary, workers will not receive the 5% salary increase for the industry agreed with the union, but this increase will go to a fund intended to finance reductions in working hours, as proposed by IG Metall.
Likewise, employees will give up the May bonus in 2026 and 2027 and will not have Christmas pay in 2025 and 2025.
Volkswagen CEO Oliver Blume stated that the agreement “is an important signal for the future viability of the brand”, with which the company has established “a decisive course for its future in terms of costs, capabilities and structures”.
The union’s chief negotiator, Thorsten Gröger, assured that the package included “painful contributions from the workers”, but at the same time created “prospects for the workforce.”
Three months of negotiations
Volkswagen and the workers had been negotiating the collective agreement and a cutback plan in Germany since September, although the rapprochement between the parties intensified this week, with the start of the fifth round of talks on Monday, which has continued until this very day. Friday.
At first, the company proposed a 10% cut in salaries, as well as the closure of at least three of its 10 factories and reducing the size of the rest, which meant a workforce cut of about 55,000 employees. as Gröger explained.
IG Metall, for its part, began by proposing a 7% salary increase, and later put on the table a savings plan of around 1.5 billion euros in salary costs.
In between, the labor conflict also returned to the company, with the call for two warning strikes – stoppages of a few hours in production – which were supported by more than 100,000 workers on both occasions.
Volkswagen earned 33.1% less between January and September 2024 compared to the previous year, after its sales fell 4.4% due to the collapse of the Chinese market and a slower transformation towards electric mobility than initially expected.
The company has about 120,000 workers in Germany and 10 factories: Wolfsburg, Emden, Osnabrück, Hannover, Zwickau, Dresden, Kassel, Salzgitter, Braunschweig and Chemnitz.
With information from EFE
