VW collective bargaining round: Thousands of employees protest. Is there a strike?

The dispute over cuts at Volkswagen is coming to a head. During the third round of collective bargaining in Wolfsburg, thousands protested loudly in front of the negotiating room against the austerity plans. IG Metall spoke of more than 7,000 participants who came to Wolfsburg from all ten German VW plants in Lower Saxony, Hesse and Saxony. The union and the works council are calling for a quick collective agreement.

At the collective bargaining round, which ended late in the afternoon, both sides also wanted to talk about the future concept of IG Metall and the works council, which is intended to reduce costs without plant closures and layoffs. VW initially reacted cautiously to the initiative, but appeared open to discussions.

During the collective bargaining round, they wanted to “enter into a more detailed exchange”. At the same time, the company emphasized that the group’s financial savings goals would remain the same. This also means that factory closures cannot be ruled out.

After the talks, IG Metall was disappointed and is now pushing for warning strikes – at least that is what they are now recommending to the 100-member collective bargaining committee of Volkswagen employees. It has become clear that mass layoffs and site closures are still not off the table.

Nevertheless, according to the union, it was agreed during the talks to continue collective bargaining on December 9th.

The negotiations had already started half an hour late. At the protest before the talks, banners called for, among other things, “Future instead of clear-cutting” and “All works must remain”. With a view to possible warning strikes, chants chanted: “We are ready.” Because work stoppages are still out of the question.

“This is just a foretaste of what will happen from December if the company does not take our concrete proposed solutions seriously,” warned works council leader Daniela Cavallo. Because VW’s peace obligation ends on November 30th. Warning strikes are then possible.

“Today is the very last chance for Volkswagen to come to a good solution before the peace obligation expires that does not involve factory closures and mass layoffs,” was the warning from IG Metall district manager Thorsten Gröger during the negotiations. Otherwise there is a risk of escalation from December 1st. “If there is no solution today, then there will be no further chance in November. Then we will prepare for industrial action.”

But he still hopes for an agreement before Christmas, said Gröger. But VW has to move to achieve this. “Otherwise, Volkswagen can be prepared for this from the beginning of December: there is a surprise behind every advent calendar door.”

The union and works council presented their own plan for the future of VW on Wednesday. According to IG Metall, this should bring a total of 1.5 billion euros in relief in terms of labor costs alone. Possible tariff increases for 2025 and 2026 should not be paid out, but rather flow into a fund for flexible working time reductions.

This is pushing the limits of what is acceptable to the workforce, says Gröger. In return, IG Metall and the works council are demanding a waiver of plant closures and redundancies for operational reasons. And the board and shareholders would also have to make a contribution. Otherwise, according to Cavallo, there will be no employee contribution.

However, the prerequisite would be for VW to take over the latest pilot agreement for the metal and electrical industry in the current collective bargaining round for the company tariff, which provides for an increase of 5.1 percent in two stages. However, this does not automatically apply to VW, where payments are made according to the company tariff. And Volkswagen has so far rejected any increase and is instead calling for a “minus round”: wages, which at VW are above the industry standard, should be reduced by a flat rate of ten percent.

With a view to plant closures and operational layoffs, VW recently signaled that it also wanted to talk about solutions that do not involve layoffs and plant closures. However, only if the savings targets set by VW are still achieved.

The core Volkswagen brand has been struggling with high costs and weak returns for years. With the cost-cutting measures, the return on investment for the core brand is expected to rise to 6.5 percent by 2026. VW justifies this primarily with the upcoming investments, for example for new electric models, which need to be financed. The VW in-house tariff applies to around 120,000 employees at the six large West German VW locations in Lower Saxony and Hesse.