Delhi: Unions on Wednesday threatened to escalate a dispute with Volkswagen over what they estimate will be more than 17 billion euros ($18 billion) in planned cost cuts, prompting a strike at a time of turmoil for the German industry. The comments come a day before a third round of crucial talks between workers and management in Germany over wage cuts and factory closings, the worst dispute in years at Europe's biggest automaker, which High costs and Chinese competition Is struggling with.
Workers are prepared to make concessions amounting to 1.5 billion euros in savings in ongoing talks, but they said this depended on Volkswagen closing the plant as well as stakeholders including the Porsche and Piëch families, who control the company.IG Thorsten Groeger, who led negotiations for the metal union, said that otherwise Volkswagen workers would descend into conflict with the company “the likes of which this republic has not seen for decades”.
Strikes are possible from December 1 at most of the carmaker's German sites, which are at the center of the conflict. Volkswagen has said deep cuts are needed at its core VW brand to make it fit for the future, including 10 percent pay cuts. The cuts are called for and the possibility of plant closure has not been ruled out, which the union said covers all scenarios presented by management.
An internal memo prepared by Volkswagen's works council, reviewed by Reuters, shows the company spends a higher share of sales on labor costs than major rivals. The concessions from IG Metall and the works council were made on Wednesday They are part of a package of proposals aimed at reducing the impact of cuts on workers. “The problems we face are not created by the workforce and will not be solved by looking at labor costs alone. Yet we are ready to contribute with what we have presented here today,” Groeger said.
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