Cost-cutting efforts at VW - remuneration negotiations brought forward

Negotiations on a new pay system have been brought forward in the context of cost-cutting efforts at Volkswagen. The parties to the collective agreement are meeting for the first time today, around seven weeks before the originally planned start on January 1, according to a joint announcement. The outdated and overly complex system is to be overhauled, while at the same time the total volume will be reduced by six percent, said Arne Meiswinkel, Board Member for Human Resources at the Volkswagen brand.

The Chairwoman of the General Works Council, Daniela Cavallo, emphasized that a vested rights logic would prevent possible disadvantages at an individual level. She had already pointed out at the beginning of the year that the target of a six percent reduction stated by VW was the upper limit that had been agreed. Cavallo said in January that this was also a downward safeguard for employees.

The company and the union had agreed on a restructuring program shortly before Christmas, which envisages 35,000 job cuts in Germany by 2030. In total, Europe's largest car manufacturer wants to reduce labor costs by 1.5 billion euros annually. The waiver of various bonus payments and wage increases is already making itself felt in the short term. In return, VW has reinstated the previously terminated job security scheme and extended it until 2030.

The negotiations are now being brought forward in order to "enable a well-founded and differentiated discussion of the complex content of the new remuneration system", it said. The previous system - with around 6,000 different work systems and 167 job descriptions - will be fundamentally simplified.

According to the company, the Volkswagen AG company wage agreement applies to around 100,000 employees at the Brunswick, Emden, Hanover, Kassel, Salzgitter and Wolfsburg sites. From the beginning of 2026, the three VW sites in Saxony - Chemnitz, Dresden and Zwickau - will become part of the agreement. The new remuneration system is to become binding on January 1, 2027.