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Workers at Europe's biggest automaker and Germany's largest employer are on strike today. Volkswagen faces a backlash for its plans to cut wages, lay off workers and close factories in Germany for the first time in its history. NPR's Berlin correspondent Rob Schmitz reports.
ROB SCHMITZ, BYLINE: The four-hour warning strike will shut down the automakers' plants throughout Germany. Extended strikes are planned later in the week if a deal with the workers' union and management is not made in a fourth round of negotiations that start today.
UNIDENTIFIED WORKER: (Speaking German).
(CHEERING)
SCHMITZ: At a worker rally last month in front of the company's headquarters in Wolfsburg, Lara Heinemann (ph), an HR employee at VW, said the company's board needs to wake up.
LARA HEINEMANN: (Speaking German).
SCHMITZ: "VW has to invest in the future," said Heinemann, whose father also works at VW. "We have to innovate rather than simply cutting corners. We're here to make sure VW has a future that keeps every factory open." But Volkswagen's chief negotiator Arne Meiswinke says that will be difficult when the company is on track to make half a million fewer cars than before the COVID pandemic.
ARNE MEISWINKE: (Speaking German).
SCHMITZ: "We can only offer secure jobs if we operate well," said Meiswinke. "This means we must increase efficiency and reduce costs." Volkswagen says it has not ruled out shutting down plants inside Germany for the first time in its history.
CARSTEN BRZESKI: So there is not this one mistake or wrong decision Volkswagen made. It's a long list of self-made or homemade mistakes.
SCHMITZ: ING economist Carsten Brzeski says VW is failing due to bad choices, like when it installed software a decade ago to cheat on emissions tests in the U.S. or when it underestimated the pace at which the Chinese auto industry, an industry that VW was instrumental in building, was not only catching up but overtaking German automakers. And Brzeski says VW's decline mirrors the decline in the German economy, Europe's largest. And he says it's spreading across Europe.
BRZESKI: So with France now in political woes and probably also economic stagnation, with the U.S. trying to impose tariffs, the short-term outlook for the German economy in general is not good.
SCHMITZ: With the auto industry making up more than 4% of Germany's economy, Brzeski predicts VW's troubles will likely have a spillover effect on the hundreds of companies in the country's massive auto supply chain. He predicts unemployment in Germany will likely climb from 3% to 4% by the end of next year.
Rob Schmitz, NPR News, Berlin. Transcript provided by NPR, Copyright NPR.
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