Volkswagen’s woes mount as workers prepare to strike across Germany

London (CNN) — Tens of thousands of Volkswagen workers will participate Monday in strikes at plants across Germany, labor union IG Metall said, marking the largest walkouts at the carmaker’s domestic operations since 2018.

The walkouts, which are planned to last several hours, follow weeks of collective bargaining negotiations during which VW refused to rule out mass layoffs and potential plant closures in its home market — drastic measures the company says are necessary to prop up its fortunes amid competition from China and weaker European demand.

A so-called “peace obligation” between workers and the company, which prohibited industrial action, expired on Saturday, allowing strikes to take place from Sunday at virtually all of Volkswagen’s German factories.

“If necessary, this will become the toughest wage dispute Volkswagen has ever seen,” IG Metall’s chief negotiator Thorsten Groeger said in a statement Sunday. “How long and intense this dispute will be is Volkswagen’s responsibility at the negotiating table.”

“Volkswagen has set our collective bargaining agreements on fire, and instead of extinguishing this fire during three rounds of negotiations, the management board keeps throwing open barrels of gasoline onto it,” he added.

The walkouts will be the first large-scale strikes that Volkswagen has faced since 2018, according to IG Metall, when 50,000 workers idled plants over pay. Although the work stoppages will last only a few hours, it is possible that 24-hour warning strikes could be called later this year. Indefinite strikes could also be called as a last resort, but only after members have been consulted again, IG Metall said.

The strikes represent a fresh headache for Europe’s largest automaker, which saw operating profit for the first nine months of the year tumble by a fifth from the previous year, as its flagship brand struggled. Vehicle sales also slipped on particularly weak demand in China, where it is losing market share to Chinese electric vehicle brands.

A spokesperson for Volkswagen said in a statement that the carmaker had taken steps in advance to minimize the impact of the strike on its factories and customers.

“Volkswagen respects the right of employees to participate in a warning strike,” the spokesperson added, noting that the company remains committed to “constructive dialogue” to find a solution.

Volkswagen has said it may need to close plants in Germany for the first time in its 87-year history. In October, it said that employee pay would need to be cut by 10% to make it more cost-competitive and safeguard the company’s future.

IG Metall said last month that workers would be prepared to forfeit pay increases totaling €1.5 billion ($1.6 billion) if executives at the company pledge not to close any factories and agree to sacrifice a portion of their bonuses.

The fourth round of negotiations will take place on December 9.

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