Nine Volkswagen plants on strike

Strikes could escalate unless deal is struck in negotiations

BERLIN/ HANOVER, GERMANY:

Workers at nine Volkswagen car and component plants across Germany started two-hour strikes on Monday, bringing assembly lines to a halt as labour and management clash over the future of Europe's biggest carmaker.

Workers on their morning shifts went on strike for two hours, while those on evening shift plan to leave work early in protest at the carmaker's demands, which include a 10% wage cut.

Volkswagen has threatened to close plants in Germany for the first time in its 87-year history, saying it needs to reduce costs and boost profit as European carmakers struggle with weak demand, high production costs, competition from Chinese rivals and a slower-than-expected electric vehicle transition.

At Volkswagen's main plant in Wolfsburg, which employs 70,000 people, a two-hour strike means several hundred cars, including the iconic Golf, cannot be built, union sources said.

An agreement not to stage walkouts ended on Saturday, enabling industrial action across VW AG's German plants.

In addition to Wolfsburg and Hanover, which employs a further 14,000 staff, plants affected include Zwickau, VW's EV-only plant, where workers will strike on Monday and Tuesday.

The crisis at Europe's largest carmaker has hit Germany at a time of economic uncertainty and domestic political upheaval, as well as wider turmoil among the region's automakers.

Stellantis Chief Executive Carlos Tavares resigned abruptly on Sunday after the group lost around 40% of its value this year.

The VW strikes, which could escalate into 24-hour, or unlimited stoppages unless a deal is struck in the next round of wage negotiations, will reduce Volkswagen's output, adding to the impact of declining deliveries and plunging profit.

"How long and how intensive this confrontation needs to be is Volkswagen's responsibility at the negotiating table," Thorsten Groeger, who leads negotiations on behalf of the IG Metall union, said.

"Anyone who ignores the workforce is playing with fire – and we know how to turn sparks into flames," he added.

Daniela Cavallo, head of Volkswagen's works council, reiterated that Volkswagen's biggest shareholders, which apart from Lower Saxony include a holding firm controlled by the Porsche and Piech families, may also have to make sacrifices with regard to the annual dividend.