Volkswagen Faces Widespread Worker Strikes in Germany Amid Tense Wage Dispute
Employees of Volkswagen Commercial Vehicles take part in a demonstration at a plant in Hanover, Germany, on December 2, 2024.
Volkswagen’s German plants experienced significant disruptions on Monday as tens of thousands of workers staged strikes, marking the most extensive labor action at the automaker since 2018. The strikes, organized by the labor union IG Metall, come after weeks of contentious wage negotiations. The union accuses Volkswagen of proposing drastic measures, including potential mass layoffs and factory closures, to address competitive pressures from China and sluggish European demand.
With a “peace obligation” preventing industrial action expiring on Saturday, IG Metall workers began walkouts Sunday, targeting nine of Volkswagen’s ten German facilities. The union has described the strikes as a warning, with potential for longer 24-hour or indefinite strikes if negotiations fail.
Thorsten Groeger, IG Metall’s chief negotiator, criticized Volkswagen’s management for escalating tensions. “Volkswagen has set our collective bargaining agreements on fire,” Groeger said, warning of a “tough wage dispute” unless the company adjusts its approach.
Workers protest outside Volkswagen's headquarters in Wolfsburg, Germany, on December 2, 2024.
The strikes come as Volkswagen grapples with declining financial performance. Operating profit for the first nine months of the year fell 20%, and the automaker faces dwindling demand in China, a crucial market where domestic electric vehicle brands are gaining ground. The company has also floated the possibility of closing German plants for the first time in its 87-year history and has suggested cutting employee pay by 10% to improve cost efficiency.
Despite the walkouts, Volkswagen said it had taken steps to minimize disruption to its operations and customers. The company emphasized its commitment to reaching a resolution through “constructive dialogue.”
Volkswagen factory plant in Germany.
IG Metall has proposed a compromise, offering to forgo wage increases worth €1.5 billion ($1.6 billion) if Volkswagen guarantees no factory closures and executives agree to reduce their bonuses. The next round of negotiations is scheduled for December 9.
This latest labor action reflects growing tensions within Europe’s largest automaker as it faces intense global competition and internal restructuring challenges. The outcome of the negotiations could set a significant precedent for the company’s future labor relations and strategy.