Key talks between representatives of German carmaker Volkswagen and union officials started on Monday, with the aim of resolving a collective bargaining dispute before Christmas.
The two-day talks in the northern city of Hanover started at 11am (10am GMT), with the management of Europe’s largest carmaker demanding an across-the-board 10% pay cut for VW’s German workers, and threatening to close and close factories in Germany cut back. tens of thousands of jobs.
About 100 VW employees gathered outside the hotel where the talks are taking place to protest the carmaker’s massive cost-cutting plans.
Protesters carried signs with slogans such as “Work for all our locations” and “We fight for our collective wage agreements.”
VW executives say high labor costs in Germany are contributing to disappointing financial results, exacerbated by fierce competition in China and problems with the transition to electric vehicles.
IG Metall, the union representing most Volkswagen workers, has flatly rejected management’s demands and vowed to wage a bitter fight against the cuts unless VW agrees to compromise.
The union has called for all locations and the approximately 130,000 VW employees to be retained, and has rejected permanent pay cuts.
In an effort to increase pressure on executives, workers have already staged two rounds of strikes in December, threatening further action.
The final talks – the fifth round of negotiations in total – are being held at a hotel in Hannover, rather than at the company’s headquarters in Wolfsburg.
Although both sides have expressed hope that an agreement can be reached before the Christmas holidays, when most of Germany traditionally comes to a standstill, there is still much work to be done.
“We are now finally expecting [management] to work constructively with us on this road and to find good solutions before Christmas,” said IG Metall negotiator Thorsten Gröger on the sidelines of the small meeting on the sidewalk in front of the hotel.
“We don’t want to go on Christmas holidays with this uncertainty, with the fear of whether there will be layoffs or whether locations will be closed,” said Daniela Cavallo, chairman of the Volkswagen works council.
VW chief negotiator Arne Meiswinkel also emphasized that “we cannot afford to lose any more time.”
“Urgent action is needed,” he said at the start of the talks.
“The goal now is to find a solution together. This is our shared responsibility,” said Meiswinkel.
To secure the company’s future, both parties needed to “identify further financial potential that will lead to sustainable cost savings.”
With the two sides still far apart, talks are expected to continue until late Tuesday.
After the fourth round of negotiations last week, both sides said for the first time that the talks had been constructive, but without any real progress.
