Volkswagen and IG Metall union to start further talks on Germany cuts

Volkswagen's operations in Germany: Volkswagen and Germany's IG Metall union will start their second round of negotiations on planned cuts to the carmaker's German operations on October 30, with unions insisting the company must keep all German sites open.

Tensions at the carmaking giant are running high as the spectre of factory closures, which would be a first for the company in Germany, sets it on a collision course with worker representatives who make up half of its supervisory board and can sway decisions on company strategy.

Already, the carmaker has scrapped a decades-old agreement, which guaranteed jobs at six German plants until 2029, and said it must deepen an ongoing cost-cutting drive in the face of waning demand, under-usage of factory capacity, and stiff competition from new EV-only competitors.

"Enough time has now passed since the first negotiations for the management board to do its homework," IG Metall's negotiator Thorsten Groeger said in a statement on Tuesday.

"We expect the company to finally present a master plan for the next decade that will ensure employment and capacity utilisation."

In the first round of negotiations in late September, unions called for a reinstatement of job guarantees extending beyond 2030, utilisation of all German sites, and a 7 per cent raise in line with IG Metall's wage demands for the entire industry, on which separate negotiations are ongoing.

After Volkswagen rejected the demands, the talks ended without agreement and unions threatened to go on strike if no solution was found before December 1.

"Only by achieving sustainable cost savings can we invest in new technologies and secure jobs in the long term," said VW's lead negotiator Arne Meiswinkel after the first round of talks.