Volkswagen, for the first time in its 87-year history, has announced the possibility of closing factories in Germany to cut costs and increase profits. This caused a large-scale strike, in which almost 70,000 company employees took part.
Workers protested management's plans to cut wages, close at least three factories in Germany and outsource some manufacturing processes. Plants in Braunschweig, Emden, Hanover, Kassel, Salzburg and Wolfsburg, as well as subsidiaries of Volkswagen AG, were under threat.
The problem worsened against the backdrop of a significant drop in the company's profits. In the third quarter of 2024, Volkswagen earned 1.576 billion euros after taxes, which is 2.8 times less than in the same period of 2023 (4.347 billion euros). Among the reasons for the financial difficulties are a decrease in demand for electric vehicles, an increase in operating costs and increased competition from Chinese manufacturers.
Last week, the workers' union proposed measures that would save €1.5 billion, including scrapping bonuses in 2025 and 2026. However, the management and union leaders have not yet reached an agreement on how to overcome the crisis.
The next round of negotiations between the parties is scheduled for December 9. The participants hope to reach a compromise that will save jobs without sacrificing the sustainability of the company.
