By Dominic Chopping
Volkswagen and labor leaders resumed talks Monday as they continue protracted negotiations over how to move forward with cost cuts across the German auto giant's domestic operations.
Speaking ahead of the talks in Hanover, the head negotiator at metal-workers union IG Metall said he hoped to find an agreement before Christmas while also conceding that the two sides are still a long way apart on key issues.
"If there is no solution, IG Metall's escalation plan stands," Thorsten Groeger said.
The union has threatened unprecedented strike action in the new year if no agreement can be found before then.
Volkswagen has proposed cutting workers' pay by 10% and scrapping bonuses while insisting that capacity must also be cut as it resizes to adapt to waning electric-vehicle demand, competition from Chinese rivals and high labor costs. But labor leaders are refusing to accept any factory closures, mass layoffs or salary reductions.
According to the head of Volkswagen's works council, Daniela Cavallo, the company wants to shut at least three factories in Germany and lay off tens of thousands of staff.
Successive rounds of talks have failed to deliver an agreement, prompting around 100,000 workers at nine plants across the country to stage walk-outs on each of two days of strikes in recent weeks.
Ahead of the fifth round of talks, Volkswagen's chief negotiator Arne Meiswinkel reiterated that there is an urgent need for action to secure the company's future.
"We must work together to find further financial potential that will lead to sustainable cost relief for the company," he said. "This relief is absolutely necessary."
Talks are scheduled over the next couple of days.
Write to Dominic Chopping at dominic.chopping@wsj.com
(END) Dow Jones Newswires
December 16, 2024 09:35 ET (14:35 GMT)
Copyright (c) 2024 Dow Jones & Company, Inc.
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