Sightful Invest
  • Business
  • Investing
  • Politics
  • Stock
Top Posts
Top 5 moments from Charlie Kirk’s memorial service...
Trump set to approve TikTok deal ensuring majority-American...
Harris is speaking. This time, she isn’t bending...
Hamas letter to Trump asks for 60-day ceasefire...
Trump must make UN funding conditional on real...
Democrats skip Charlie Kirk Arizona memorial after 58...
‘Due to overhelming support:’ Turning Point USA says...
Thune slams Democrats’ ‘cold-blooded partisan’ tactics as funding...
Macron stakes anti-Trump global role with Gaza initiative...
Trump assassination attempt suspect Ryan Routh questions first...
  • Business
  • Investing
  • Politics
  • Stock

Sightful Invest

Business

Volkswagen braces for showdown with unions after warning of possible German plant closures

by admin September 4, 2024
September 4, 2024
Volkswagen braces for showdown with unions after warning of possible German plant closures

German automotive giant Volkswagen is bracing for a showdown with trade unions shortly after it said it cannot rule out shutting factories in its home country for the first time in its nearly 90-year history.

Volkswagen’s management is expected to lay out its plans before about 18,000 workers at a town hall meeting in Wolfsburg on Wednesday morning, amid speculation that the carmaker could push to close sites in Osnabrueck in Lower Saxony and Dresden in Saxony.

A spokesperson for Volkswagen was not immediately available to comment when contacted by CNBC on Tuesday.

In a move that underlines the challenges facing Europe’s top legacy carmakers, Volkswagen warned on Monday that it would no longer be able to rule out plant closures in Germany.

The Wolfsburg-headquartered company also said it felt compelled to bring an end to its employment protection agreement — a job security program that has been in place since 1994 — in order to secure “urgently needed structural adjustments for greater competitiveness in the short term.”

Volkswagen Group CEO Oliver Blume said in a written statement on Monday that the carmaker would need to “act decisively” in order to future-proof the company.

“The European automotive industry is in a very demanding and serious situation,” Blume said.

“The economic environment became even tougher, and new competitors are entering the European market. In addition, Germany in particular as a manufacturing location is falling further behind in terms of competitiveness,” he added.

Volkswagen said that all necessary measures would be discussed with the General Works Council — a group of elected staff members that represent the interests of a company’s workforce — and with top German industrial union IG Metall. Both groups, which hold significant influence at the company, have been sharply critical of the proposals.

Daniela Cavallo of Volkswagen’s General Works Council said that the faction would “fight bitterly” against the potential plant closure measures, while a spokesperson for IG Metall described the plan as one that “shakes the foundations of Volkswagen and poses a massive threat to jobs and locations.”

Shares of Volkswagen dipped 0.8% at around 2:15 p.m. London time on Tuesday, paring gains from the previous session. Volkswagen’s stock price has fallen by more than 33% over the past five years.

The downturn comes amid a difficult economic environment for the carmaker and an influx of new rivals in Europe, as Volkswagen attempts to survive the transition to electric cars.

“The situation is extremely tense and cannot be resolved through simple cost-cutting measures,” VW brand CEO Thomas Schäfer said on Monday.

“This is why we want to initiate discussions with employee representatives as soon as possible to explore the possibilities for sustainably restructuring the brand,” he added.

Volkswagen’s plans to consider unprecedented plant closures in Germany comes at a politically fraught time for Europe’s largest economy. Led by Chancellor Olaf Scholz, the ruling three-way coalition in Berlin was dealt a heavy blow in regional votes over the weekend.

“The German automotive industry stands for globally successful products and innovations. It is a central pillar for growth and prosperity in Germany,” a German government spokesperson told CNBC by email, without commenting specifically on Volkswagen’s planned measures.

“At the same time, it is currently in a challenging phase of transformation towards electromobility. This also requires the adaptation of traditional structures and measures for greater competitiveness,” the spokesperson added, according to a Google translation.

“A close social partnership is a hallmark of the German automotive industry. The Federal Government therefore appeals to the social partners involved to continue to fulfil this responsibility in the future.”

Thomas Besson, head of automotive research at Kepler Cheuvreux, said the problems at Volkswagen reflect an “industry-wide story.”

“We are seeing a major fragmentation story of the global automotive landscape,” Besson told CNBC’s “Street Signs Europe” on Tuesday.

“The situation … is also specific to Volkswagen, in the sense that they have put in place a number of guarantees for workers,” he added.

— CNBC’s Annette Weisbach contributed to this report.

This post appeared first on NBC NEWS

previous post
NFL season expected to spur record $35 billion in legal sports wagers
next post
Mawson Finland Limited Expands Known Mineralized Zones at Rajapalot: New Lens Intercepts 21.75 m at 5.25 g/t Gold & 515 ppm Cobalt

You may also like

California homeowners allege home insurance companies colluded to...

April 24, 2025

Google’s antitrust ruling has experts looking to 25-year-old...

August 8, 2024

Crash victims’ families prepare to make what could...

September 4, 2025

Italian chocolate giant Ferrero to buy Kellogg’s Froot...

July 11, 2025

Hertz says 2024 hack exposed some customers’ driver...

April 16, 2025

Walmart hikes its outlook again as shoppers spend...

November 20, 2024

Dow closes nearly 500 points lower Thursday as...

August 3, 2024

Bed Bath & Beyond relaunches with first store...

August 15, 2025

Microsoft laying off about 9,000 employees in latest...

July 3, 2025

Promises of ‘passive income’ on Amazon led to...

September 28, 2024

Recent Posts

  • Top 5 moments from Charlie Kirk’s memorial service in Arizona
  • Trump set to approve TikTok deal ensuring majority-American investor control: White House
  • Harris is speaking. This time, she isn’t bending to Biden’s bullies
  • Hamas letter to Trump asks for 60-day ceasefire deal to release half of hostages, sources say
  • Trump must make UN funding conditional on real reforms, ex-diplomat urges

    Sign up for our newsletter to receive the latest insights, updates, and exclusive content straight to your inbox! Whether it's industry news, expert advice, or inspiring stories, we bring you valuable information that you won't find anywhere else. Stay connected with us!


    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Categories

    • Business (927)
    • Investing (3,032)
    • Politics (3,709)
    • Stock (4)
    • About us
    • Contact us
    • Privacy Policy
    • Terms & Conditions

    Disclaimer: sightfulinvest.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2025 Sightful Invest. All Rights Reserved.