'Wages and Employment Cuts' Volkswagen Strikes Warning Across Germany On 2nd

German carmaker Volkswagen workers will go on a warning strike across Germany on the 2nd local time against pay cuts and restructuring.

The metal industry union IG Metals said in a statement that it was up to management to see how long and how strong the labor-management confrontation would continue, warning that the strike, if necessary, could be the toughest collective bargaining in Volkswagen's history.

Collective bargaining between the two sides continues, but the management insists on a 10% pay cut and some factories closed, and the union refuses to accept it, failing to narrow differences, AFP said.

Reuters and others described the strike as the first major strike at Volkswagen's domestic operations since a strike involving more than 50,000 people in 2018.

Hit by high manufacturing costs, delays to switching to EVs and fierce competition in the main market in China, Volkswagen has been demanding a 10% pay cut to keep its market share in the face of falling demand for cars in Europe, as well as to cut costs and boost profits.

In addition, the company has insisted on closing at least three out of 10 factories in Germany and laying off thousands of workers, but the union says it should keep the plants running.

German media predict up to 30,000 of Germany's 120,000 employees will lose their jobs, depending on the size of the plant to be closed.

The union last week proposed a plan to save 1.5 billion euros, or about 2.2 trillion won, including abandoning bonuses in 2025 and 2026, but the management rejected it, saying it "may help in the short term, but it will not lead to long-term financial structural improvements."

A Volkswagen spokesperson said the company had been bracing for a possible strike and would "minimize the impact of the warning strike on customers, partners and industrial plants as much as possible."

He also said he respects the rights of employees participating in short-term strikes and stressed that he would have constructive talks with the union to reach a sustainable agreement with each other.

The two sides will meet again on the 9th to continue negotiations.