By on April 26, 2016

Volkswagen CrossBlue Concept

It just posted its largest loss ever and is up to its eyebrows in scandal-related expenses, so what’s an automaker to do when the hands come out asking for more?

That’s the situation in Wolfsburg, Germany, where the scandal-rocked Volkswagen and its workers’ labor union find themselves engaged in an uncomfortable dance, according to Automotive News Europe.

The union, IG Metall, says the automaker’s diesel emissions scandal is no excuse for holding back raises to its 120,000 staff members, and Volkswagen says, “What? Sorry, can’t hear you — we’re driving into a tunnel…call back later.”

IG Metall is seeking a five percent pay raise for the workers. Volkswagen, meanwhile, just plummeted from prosperity to a 4.1 billion euro ($4.6 billion) operating loss for 2015, and just had to set aside $16.2 billion euros ($18.2 billion) to pay its U.S. settlement costs.

In addition to that, it has proposed to cut its stock dividend by 97 percent, possibly certainly irritating investors. Oh, and there’s still lawsuits and fines to deal with.

Volkswagen’s human resources chief Martin Rosik was heard saying that a “measured settlement is more important than ever,” outside of a wage meeting today.

Though the company says its hands are full and pockets empty, the union is not having any of that.

“Workers on the assembly line, at the foundry or in administration have not carried out manipulations,” said Hartmut Meine, the union’s main pay negotiator. “That is why the workers will not pay the price. Others have to take the responsibility.”

If Volkswagen doesn’t acquiesce to the union demands, IG Metall could have its workers on the picket line on May 31, the day their wage contract runs out. Before that happens, the union wants the employer to table its offer to employees at a May 2 meeting.

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16 Comments on “For Some Weird Reason, Volkswagen is Having a Hard Time Agreeing to Union Pay Hike Demands...”

  • avatar
    SCE to AUX

    TDI customers are doing the same thing right now.

  • avatar
    Master Baiter

    Welcome to The Truth About Volkswagen.

    • 0 avatar

      I wonder if people were complaining about all that Watergate coverage. Scandals take awhile to unfold, but until the facts and ramifications all come out, they’re still a major story. How the VW saga is wrapped up has lessons for all carmakers in the future, and every aspect of it is car news.

  • avatar

    Volkswagen Death Watch?

    Countdown to a German bail-out?

  • avatar

    Wow, crazy. VW is generally very union-friendly (they even welcomed UAW organization of the Chattanooga plant), so this sounds like they are really sweating about what they’re going to pay out for the TDI settlements. It’s all self-inflicted, so I can’t work up much sympathy for VW.

    Think Sergio wants a merger with VW now?

  • avatar

    “Workers on the assembly line, at the foundry or in administration have not carried out manipulations,” said Hartmut Meine, the union’s main pay negotiator. “That is why the workers will not pay the price. Others have to take the responsibility.”

    This is why people hate unions. The 2008 melt down was not the workers fault either, but many lost their jobs or took pay cuts then. C’mon man-up, your company needs you. Don’t kill the goose that lays the golden egg. PS; I’m not anti-union. I have been a member of a union.

  • avatar

    While I sympathize with the workers not wanting to take the hit for inept management to ask for a 5% raise when Germany’s inflation rate is less than 1% is ridiculous.

    • 0 avatar

      So 5% over a three or four year contract, while the inflation rate is at 1% is un-fair? God for-bid any person who does not have a PH.D should be able to do more then feed themselves..

  • avatar

    You know, I wonder if VW would actually welcome a strike. Wouldn’t it reduce current oversupply, while not costing as much as running the factories anyway? (I know there are still significant costs in a strike, but they must be less than actual production, no?)

  • avatar

    The ship is sinking. Let’s stop bailing the water out though and demand more wine and hardtack.

  • avatar

    Lets see, board and managers get big bonus payments for defrauding the world and workers are refused a pay increase because the above got caught. Yes, that works.

  • avatar

    I just heard on our local news that VW sold more cars worldwide in the first quarter than any other automaker. Sure it was Europe and China that led the way , but scandal only appears to the North American market so any over capacity would be limited to USA/Canada.I guess the VW vehicles must appeal to a broad market, you can’t tell me they are the only option in these foreign markets.

    My TDI continues to be good to me, and I might even consider an upscale VAG product soon.

    • 0 avatar

      It goes beyond that even. One of the more interesting aspects of all this is that the scandal itself removed inventory. VW dealers are in the news lately demanding increased inventory of cars that they can legally sell in the US. If there are any US specific tdi components then vw is likely facing oversupply of those right now, but I’m not even sure if that’s a thing anymore with the recent near leveling of emissions targets. This is a bizarre situation, a regulatory violation that has a supply effect more similar to a natural disaster, like the Taiwan floods.

  • avatar

    This will be resolved with a 1.5% annual raise, a free used TDI for each employee, and Audi work shirts to replace all of their uniforms with VW logos on them.

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