On the Dash:
- Volkswagen pay freeze through 2030 would hold compensation at 2026 levels worldwide.
- IG Metall is pushing for a 5% raise and warns of 10% real wage losses.
- Volkswagen has not confirmed the plan, and strikes are possible from Jan. 1.
Volkswagen is pushing for a global pay freeze through 2030, according to the automaker’s worker representatives. The move sets up a clash with labor as new wage talks get underway in Germany, Bloomberg reported.
The company’s European and Global Works Council said the executive board told human resources managers worldwide to plan for no pay raises through 2030, but pay would stay at 2026 levels. According to the labor representatives, the directive has been in place since early October.
Volkswagen has not confirmed the plan, declined to comment and said it will soon begin talks on its labor contract with IG Metall, Germany’s largest industrial union, Bloomberg reported.
IG Metall says the freeze would cover more than 660,000 workers worldwide. The union warns workers could lose at least 10% of their buying power because pay would not keep up with inflation. IG Metall is asking for a 5% raise. The current wage deal for German operations runs through the end of December.
The talks follow a Sept. 30 announcement that Volkswagen is ending several labor agreements at the end of the year. The agreements remain in force by law until new ones take effect. Notably, the job-security rules are unaffected. IG Metall says its no-strike obligation ends Jan. 1 and that it is ready to strike after that.
Bloomberg reported that negotiations are likely to soften the proposals. Volkswagen and IG Metall have typically resolved pay disputes at the bargaining table, and both sides want to avoid a prolonged fight as the automaker restructures.
In September, Volkswagen reached an agreement with worker representatives to double its global job cuts to 100,000, or about 15% of its workforce. It also lowered its 2026 operating forecast to no more than 1%. The company aims to restore its operating margin to at least 8% by 2030.
Volkswagen has not set long-term plans for its plants in Emden, Zwickau and Hannover, or for Audi’s Neckarsulm site. A plan to spin off the Volkswagen car brand and parts operations was dropped for now. Workers fear it would weaken their say in company decisions. CEO Oliver Blume said last month that management is still studying spin-offs.
