On September 4, 2024, employees of German car manufacturer Volkswagen (VW) protested at the beginning of the company’s shareholders meeting in Wolfsburg, northern Germany.
Moritz Frankenberg | AFP | Getty Images
Management of German car giant Volkswagen Prepare for confrontation with workers On Wednesday, top business leaders prepared to unveil details of possible cuts that could include historic domestic factory closures.
According to CNBC, images released by Getty Images showed employees protesting the company’s potential plans at a city hall, waving union flags and signs saying management failures were not their fault and urging leaders to “finally do something.” Good job.”
According to the comments, Volkswagen Group Chief Financial Officer and Chief Operating Officer Arno Antlitz told employees: “For some time, we have been spending more on the brand than we earn. In the long term, this does not matter. not good.
Employees of German carmaker Volkswagen hold a banner that reads “A ping-pong table without balls is like pressing without a press” at the start of the company’s shareholders meeting in Wolfsburg, northern Germany, on September 4. factory”. , 2024.
Moritz Frankenberg | AFP | Getty Images
Volkswagen issued warning on Monday The company is no longer ruling out closing factories in its home country of Germany – a step that was previously considered impossible and has never been taken in the company’s record.
The car company also said it believed the employment protection agreement, which has been in force since 1994 and protects Germany’s workforce until 2029, may need to be terminated.
Speculation grew on Tuesday about Volkswagen closing its plants in Osnabrück and Dresden in Lower Saxony.
“In particular, improving the cost efficiency of German factories is our joint responsibility. We need to increase productivity and reduce costs,” Antlitz said.
“We still have a year, maybe two years to turn things around. But we have to use that time.”
Volkswagen’s union, made up of employees who represent the interests of workers within the company, and Germany’s main industrial union IG Metall are highly critical of the plan and have announced they will oppose it.
On September 4, 2024, employees of the German automobile manufacturer Volkswagen (VW) waited for the company’s shareholders meeting to be held in Wolfsburg, northern Germany.
Moritz Frankenberg | AFP | Getty Images
According to CNBC, Daniela Cavallo, the main representative on Volkswagen’s general engineering committee, said earlier this week that the organization would show “strong resistance” to these plans. She said profitability and job security had been considered equal goals for decades, but the company had now decided to end the deal.
Cavallo added that the most important thing now is to understand the future and understand where the business is headed.
German media also quoted her as saying she hoped Wednesday’s town hall would be fully attended and workers would be able to loudly express their dissatisfaction that day.
Philippe Houchois, head of global automotive at Jefferies, told CNBC’s “Squawk Box Europe” on Monday that Volkswagen CEO Oliver Blume would try to ease resistance to the potential plan.
“Bloom is different from his predecessor. He’s probably more of an insider and he’s going to see to what extent he can change some of the resistance from the public and adapt to the public,” he said.
Hochos also said that based on comments made in recent days, the differences between VW management and employee representatives on fundamental issues may not be that great.
“The question is how they come to an agreement or how they actually work together, but the end result seems to be understandable to both sides,” he said.
Volkswagen’s underlying problems come at a difficult time for the German economy as a whole and the country’s auto industry, which faces a host of challenges.
On Wednesday, the Ifo research institute said that business sentiment in the German auto industry fell again in August, falling to negative 24.7 points from negative 18.5 points in the previous month. Ifo said business expectations for the next six months were “extremely pessimistic.”
