'Zero raise by 2030' plan from Volkswagen for 660 thousand employees

In the statement made by IG Metall, it was stated that in the message sent to workers by Volkswagen Europe and the World General Workplace Council, the company management instructed human resources managers to maintain the current collective agreement wage levels and suspend all salary increases.

The union announced that due to this new directive, which is stated to have come into force as of the beginning of October, employees may face a loss of purchasing power of at least 10 percent within the scope of the "zero raise" policy to be implemented until 2030.

Strong resistance signal from workers' representatives

Describing the step in question by Volkswagen management as "unreal", the union announced that it would show harsh resistance against the plan.

IG Metall stated that structural problems in the automotive and metal industries cannot be solved with wage cuts, and that personnel costs have a very low share in total sales costs.

VW Group employs more than 660 thousand employees worldwide. In the group, which has approximately 275 thousand employees throughout Germany, 130 thousand workers are directly covered by the internal collective bargaining agreement.

IG Metall is demanding a 5 percent wage increase for Volkswagen employees, as well as for approximately 3.7 million workers in the metal and electrical industry across the country.

Stating that Volkswagen management did not officially submit its demands, union officials noted that the "zero raise" plan is an indication of how difficult future negotiations will be.

Negotiations for a new collective bargaining agreement within the Volkswagen Group, which is going through the largest restructuring process in its history, are expected to begin at the end of November.

These negotiations will affect general contracts for the metal and electrical engineering sector, including group subsidiaries such as Audi, MAN and Porsche.

Major transformation and employment cuts target in the group

Volkswagen management, which terminated the existing collective bargaining agreements about a month ago, aims to reduce 50 thousand more jobs worldwide in the coming years, in addition to the existing reduction plans across the group.

While the details of these programs continue to be negotiated with workers' representatives, the status of the company's factories in Emden, Hannover and Zwickau and Audi's Neckarsulm plant after 2031-2034 remains unclear.