Volkswagen reaches agreement with IG Metall trade union to prevent plant closures in Germany, ensuring more than 35,000 jobs are cut by 2030 through a ‘socially responsible’ plan.
Volkswagen Reaches Deal to Avoid Plant Closures in Germany
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Volkswagen has reached an agreement with the IG Metall trade union that will prevent plant closures in Germany and avoid immediate compulsory redundancies. The deal was struck after drawn-out negotiations, which began in September, and will see more than 35,000 jobs cut across the country by 2030.
Job Cuts and Restructuring
The two sides have agreed to reduce production capacity across Volkswagen’s plants as part of a “socially responsible” plan. The company had previously warned it might need to close up to three factories in Germany due to cost-cutting measures. As part of the agreement, Volkswagen will implement job cuts through various means, including offered early retirement.
Key Provisions of the Agreement
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No plant closures or layoffs for operational reasons
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Secured long-term company wage agreement
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5% wage increase suspended in 2025 and 2026 to support transformation at the company
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Reduction in apprenticeships from 1,400 to 600 per year from 2026
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Exploration of alternative options for Dresden and Osnabrueck sites
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Potential shift in production to Mexico
Reaction to the Agreement
The deal has been welcomed by union leaders and German Chancellor Olaf Scholz. IG Metall’s works council chief, Daniela Cavallo, described it as a “rock-solid solution” that secures jobs and enables future investment. Volkswagen’s group chief executive, Oliver Blume, said the agreement was an “important signal for the future viability of the Volkswagen brand”.
