Volkswagen braces for 2nd walkout in cost dispute

Volkswagen AG workers are set to strike again on Monday, marking the second walkout this month as labour and management hold a fourth round of negotiations over cost-cutting measures at the automaker.

The strikes, organised by the IG Metall union, aim to pressure VW to reconsider plans to close factories and lay off thousands of employees. Nearly 100,000 workers participated in walkouts last week after VW rejected a union proposal to reduce dividend payouts and bonuses instead of cutting jobs.

The dispute adds to VW’s challenges, including high operational costs, declining demand for electric vehicles, and increased competition from Chinese carmakers. Stoppages at VW’s Wolfsburg plant have already resulted in significant production losses, with each two-hour halt costing up to 600 vehicles.

Monday’s talks are critical, with Works Council Chief Daniela Cavallo warning they could lead to either a compromise or further escalation. VW’s corporate structure, which includes strong worker representation on its supervisory board, complicates management’s ability to enforce sweeping cost reductions.

Credit: Bloomberg

Subediting: M. S. Salama