VW Ponders Wage Freeze for 660,000 Employees Through 2030

Volkswagen’s internal struggles are intensifying as the board rejects CEO Oliver Blume’s plan for 100,000 job cuts. Facing geopolitical pressure and stiff Chinese competition, the company is now pursuing alternative cost-saving measures, including potential long-term wage freezes, amid fierce opposition from labor unions.

After failing to secure broad layoffs, Volkswagen has shifted its cost-cutting strategy toward a proposed wage freeze for over 660,000 global employees through 2030. According to the IG Metall union, this move—which eliminates raises and inflation adjustments—aims to offset a 1 billion euro shortfall, though the union warns it will reduce workforce purchasing power by at least 10% and fails to address the company’s deeper structural issues.

Volkswagen’s labor leadership dismissed the 8–10% return targets as fantasy. The union is demanding a 5% raise, arguing that management’s focus on workforce concessions ignores deeper structural and product failures.

The German carmaker’s crisis reflects the struggles of a legacy automaker failing to adapt to the EV shift. Trapped by high costs and intense competition, the firm’s proposed wage freezes offer only a temporary fix. To survive, Volkswagen must pivot to more competitive, high-quality production before facing potential acquisition by rivals like BYD.

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