VW: The behavior of the board is a middle finger to the workforce

How much do Volkswagen managers earn? Oliver Blume, head of Volkswagen AG, received a salary of 10.32 million euros in 2023. All nine members of the board together earned over 40 million euros.

According to the VW works council, these top managers now want to close three plants and lay off 30,000 employees. Reason: The personnel costs are too high.

The VW management team wanted to show solidarity in the spring: They waived an inflation bonus of 1,000 euros and a salary increase of 3.3 percent. This is ridiculous compared to the massive job cuts and plant closures. You are showing your own workforce the middle finger!

The savings plan also stipulates that those who do not have to go should forego 10 percent of their wages – and the usual bonuses at VW. The job guarantee, which has protected VW employees from dismissals for operational reasons since 1994, is also to be abolished.

Particularly shabby: While the workforce is now worried about their existence, VW shareholders were able to enjoy a 4.5 billion euro dividend in June. Between 2021 and 2023, VW distributed around 22 billion euros to its shareholders. The current crisis was already foreseeable.

Works council boss Daniela Cavallo is correspondingly angry. “Don’t mess with us, with the VW workforce!” she growled towards the executive floor at the end of October. “You are very close to escalation!” With it there will be no factory closures.

Christiane Benner, head of the IG Metall union, now followed up: “If the board wants to implement wage cuts, then it could set a good example,” she told the newspapers of the Funke media group on Monday.

In doing so, it names the only means of softening the hardened fronts. Management’s foregoing a few million euros hardly helps to achieve Volkswagen’s savings target. VW wants to sustainably reduce costs for its core brand by ten billion euros by 2026. But: The step would appease the angry workforce. A common solution would be within the realm of possibility. And without both sides working together, it won’t work.

The car manufacturer’s 87-year history shows that crises can only be overcome together. Company management and employees were willing to make compromises on several occasions. For example, when the four-day week was introduced in 1994. This meant that all jobs could be retained.

And a recent ruling by the Braunschweig Labor Court shows that it is certainly possible to reduce the salaries of managers. As part of the austerity program set in December 2023, VW withdrew an inflation bonus of 1,000 euros and a promised salary increase from around 100 ex-executives in early retirement. The former managers sued – and lost in court against the ex-employer. As long as it’s not about the board’s money, VW seems to be fine with any means.