Volkswagen Unions Demand Bold Moves in Pay Negotiations

Volkswagen's union has urged management to make significant compromises during the third round of pay and plant closure negotiations. Facing potential strikes, Volkswagen aims to cut wages by 10% to combat competition and declining demand. Unions propose concessions in exchange for avoiding plant closures, but tensions remain high.

Volkswagen's ongoing labor dispute has reached a critical juncture as unions call on management to take significant actions in the third round of pay negotiations. The talks take place against a backdrop of potential strikes at German sites, with union members demanding significant compromises from the automaker's executives.

The company has proposed a 10% wage reduction, citing the need to cut costs and remain competitive in light of cheap Chinese competition and falling car demand in Europe. This move has sparked fears among the workforce about possible plant closures, a measure Volkswagen could enforce for the first time in its history.

Union representatives have offered to suspend bonuses and create a fund to manage reduced working hours as a way to avoid layoffs and close the 1.5 billion euros ($1.6 billion) gap in operations. However, these concessions hinge on a commitment from Volkswagen to keep all German plants open.

(With inputs from agencies.)