Volkswagen and the IG Metall union are reportedly nearing an agreement in their wage dispute, with potential solutions aimed at retaining all VW brand plants in Germany. However, insiders indicate that significant changes could be on the horizon for the Zwickau electric car plant and the iconic Golf model’s production.
According to sources cited by Bloomberg, Volkswagen management is prepared to extend job security agreements until 2030, provided employees agree to forgo bonus payments. These measures are part of broader cost-saving efforts as the company navigates financial pressures. The fifth round of negotiations between VW and IG Metall was scheduled this week, with both parties aiming to reach an agreement before Christmas. Despite extensive discussions, no breakthrough has been officially confirmed.
One of the cost-saving measures reportedly under consideration involves relocating production of the VW Golf from the Wolfsburg plant in Germany to Puebla, Mexico. The Golf VIII, currently a plug-in hybrid, may transition to a fully electric successor, the ID. Golf. Additionally, reports suggest that production of VW-branded electric vehicles in Zwickau could be discontinued, potentially impacting the ID.3, ID.4, and ID.5 models.
The Zwickau facility, once a cornerstone of VW’s electric vehicle production, has faced reduced utilization due to weaker demand. Recent announcements included the expiration of 1,000 temporary contracts in 2025 and a reduction to two production shifts. While overcapacity is driving cost-cutting measures, Volkswagen has stated that the plant will not be closed.
Volkswagen Saxony spokesperson Christian Sommer dismissed claims about ending EV production in Zwickau as false, stating, “Stopping EV production would be equivalent to closing the site. And that can clearly be ruled out.” However, Sommer did not clarify which electric models or brands would be allocated to Zwickau in the future.
Volkswagen’s decision to cancel job security agreements earlier this year and announce potential site closures has raised tensions with IG Metall and workers. While a resolution appears within reach, unresolved issues surrounding the future of Zwickau and Golf production could strain labor relations.
The outcome of the negotiations will have far-reaching implications for Volkswagen’s workforce, Germany’s automotive sector, and the company’s transition to electric mobility. Further delays or disruptions could lead to widespread work stoppages in 2024, escalating an already contentious dispute.
