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'Trust is destroyed': Anger builds at VW as fresh strike talks make little progress

Peter Oliver in Berlin

03:13

The standoff between Volkswagen bosses and the powerful IG Metall union ramped up on Monday as the two sides entered into new talks over wages and future production in Germany – without any immediate success. 

The discussions ended with an agreement to continue to talk next Monday, but not much else. Neither side is any closer to giving way, and it looks like the dissenting workers will be tested on their promise to lower the 'strike hammer' – that's what they call it – and take industrial action on a never-before-seen scale in the new year.

"There will be no plant closures in this country," said a defiant Daniela Cavallo, head of the works council of Volkswagen AG as she addressed crowds of thousands taking part in Monday's warning strike timed to coincide with the latest round of negotiations.

Braving the cold outside of VW's Wolfsburg headquarters, the crowd chanted "Bundesweit streikbereit!" It means 'we are ready for strikes across the country.'

Monday's four-hour walk-out in Wolfsburg was repeated at nine out of the 10 VW facilities in Germany. Only in Osnabrück did VW workers go about business as usual as they are represented by a different union than IG Metall.

The IGM chief negotiator, Thorsten Groeger, said: "It is time for the board to make a move."

Employees protest at VW headquarters in Wolfsburg. /Martin Meissner/Reuters
Employees protest at VW headquarters in Wolfsburg. /Martin Meissner/Reuters

Employees protest at VW headquarters in Wolfsburg. /Martin Meissner/Reuters

The VW board has been ringing the alarm bell at one of Germany's and Europe's most recognizable brands since the summer when a profit warning announced the company had around two years to save itself.

Heading into the talks with VW bosses IMG's Groeger told reporters: "Our expectation is that the company stops insisting on its maximum positions and moves towards us. 

"Trust has been destroyed. Workers are very angry. The brand VW is under threat of becoming damaged by the behavior of the board and the share price has been thrown to the bottom of the basement. That is the board's responsibility."

Despite the proposals put forward by the union and works council looking set to save VW as much as $1.6 billion, it is understood the company needs to make significantly deeper cuts. 

They say this need for extreme belt tightening is down to low demand for cars in Europe and the cost of manufacturing in Germany means VW cannot compete with new rivals on the market.

The car maker employs 300,000 people at 10 plants across Germany. The VW board had initially wanted to shut three of those plants with the vast majority of jobs being cut entirely and those remaining at the other VW plants to take a 10 percent wage cut.

The VW stock price has been in free-fall in 2024, losing almost 25 percent of its value this year alone.

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