Volkswagen plans to freeze employee salaries until 2030, which, taking inflation into account, could lead to an effective reduction in workers’ incomes of around 10%.
The move is driven by the need to cut costs amid U.S. tariffs, falling sales in the Chinese market, and difficulties at subsidiaries Audi and Porsche. Back in 2024, 130,000 company employees had already agreed to temporarily forgo pay raises. The possibility of cutting tens of thousands of jobs is now being discussed, along with closing four plants in Germany—in Emden, Hanover, Zwickau, and Neckarsulm.
Volkswagen’s works council said management was trying to impose a multi-year decline in employees’ real incomes. In response, the IG Metall union is demanding a 5% pay raise. Strikes cannot be ruled out in November in Germany’s metalworking industry and at Volkswagen plants.
The move is driven by the need to cut costs amid U.S. tariffs, falling sales in the Chinese market, and difficulties at subsidiaries Audi and Porsche. Back in 2024, 130,000 company employees had already agreed to temporarily forgo pay raises. The possibility of cutting tens of thousands of jobs is now being discussed, along with closing four plants in Germany—in Emden, Hanover, Zwickau, and Neckarsulm.
Volkswagen’s works council said management was trying to impose a multi-year decline in employees’ real incomes. In response, the IG Metall union is demanding a 5% pay raise. Strikes cannot be ruled out in November in Germany’s metalworking industry and at Volkswagen plants.