Four German states are collaborating to prevent Volkswagen from closing its plants, amid economic challenges and union negotiations.
In a significant move to safeguard jobs and economic stability, the four German states with a Volkswagen presence have pledged to work together to prevent the struggling carmaker from shutting down any of its plants. This decision comes as Volkswagen faces mounting economic pressures and potential factory closures, a first for the company in Germany.
The states of Lower Saxony, Saxony, Hesse, and Berlin have expressed their commitment to preserving all Volkswagen sites. In a joint position paper, the states' economy ministries emphasized the importance of solidarity and coordination to ensure that no individual location is disadvantaged. They have also rejected any harsh cuts that would negatively impact employees, advocating instead for a renewed, long-term contract to secure jobs and retain expertise.
This collaborative effort is crucial as tensions rise between Volkswagen and the powerful IG Metall union. The union is currently negotiating new labor deals for Volkswagen's 130,000 workers in Germany, following the company's recent decision to end agreements that had protected jobs at six of its plants since the mid-1990s.
Meanwhile, Volkswagen's recent financial disclosures reveal a challenging economic landscape. The company's Q3 deliveries were 7% below the previous year, with a slight increase in the BEV (Battery Electric Vehicle) ratio to approximately 9%. Despite growth in North and South America, deliveries in China and Europe have declined. Volkswagen's outlook for 2024 indicates a slight decrease in sales revenue and operating margin, with non-recurring expenses impacting financial performance.
The joint efforts of the German states and the ongoing negotiations with IG Metall highlight the complex challenges Volkswagen faces as it navigates economic pressures and strives to maintain its workforce and production capabilities.
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