Volkswagen is planning to hold pay flat through 2030 for more than 660,000 workers around the world, Süddeutsche Zeitung reported Monday, citing internal documents that describe a plan the company has not confirmed.
The paper said the documents, written for international managers, call for halting raises, and Volkswagen’s global works council confirmed the report. The German union IG Metall said the board told HR chiefs in early October to budget for no increases, while a company spokesperson would not address the speculation and pointed to talks later this week as the place to discuss labor costs.
Under the guidelines, which would start in the fourth quarter, the company would also target performance-based pay, one-time payments, benefits and headcount, the paper reported. About 275,000 of the affected workers are in Germany, 130,000 of them on the in-house contract, according to Handelsblatt, which added that it is unclear how the freeze would work where local bargaining sets pay.
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Süddeutsche Zeitung estimated that inflation could shave roughly a tenth off affected workers’ purchasing power, and IG Metall put the likely hit at 10% or more, though neither figure comes from Volkswagen. German consumer prices rose 3.3% in September from a year earlier, up from 2.9% in August, the federal statistics office reported.
The works council dismissed the approach as absurd and predicted heavy resistance, and an IG Metall spokesperson said pay is settled across the bargaining table rather than ordered from the boardroom.
This appears to be part of a wider fight over labor costs. Volkswagen gave notice September 30 that it is ending most of its German collective agreements, IG Metall is demanding a 5% raise with talks set to begin in late November, and the supervisory board signed off in September on another 50,000 job cuts worldwide by 2030. The 2024 settlement already gave about 130,000 in-house contract employees no direct raise, the German news agency dpa noted.
