VW Works Council Criticizes Board for Loss of Trust Among Workforce

Lower Saxony's Minister President Olaf Lies (SPD) had announced in advance that the state would not agree to any development "that relies on plant closures as a supposedly simple solution." The state of Lower Saxony, as the second-largest shareholder, holds around 20 percent of VW's ordinary shares and thus has a blocking minority in important decisions.

Lower Saxony as blocking minority

Auto and industry expert Ferdinand Dudenhöffer, in view of the crisis, called for a return to a 40-hour workweek without wage compensation and for concessions on the part of Volkswagen employees. This could at least partially solve "the problem of high production costs." "Employees must make concessions," Dudenhöffer told the "Neue Osnabrücker Zeitung." Germany had afforded itself too much prosperity while international competition had grown stronger.

In the second quarter of 2026, the number of vehicles sold at Volkswagen fell by just under nine percent. The weak demand is considered one of the central causes of the group's economic crisis. The plants in Zwickau and Emden are also affected by the discussions about possible adjustments.

Dudenhöffer demands concessions from employees

Dudenhöffer also expressed confidence about the long-term outlook for the industry. "In five to seven years there could be an upswing," he said. However, he warned: "But the time before that will be really tough, we have to make an incredible effort." The accusation that manufacturers had missed the boat on electric mobility was rejected by the expert: "VW was the first European manufacturer to invest in a pure e-car plant."

The auto expert called on politicians, unions, and companies to hold joint talks and said: "Let's throw collective bargaining autonomy out the window for a few years!" IG Metall and the works councils had previously spoken out against any softening of existing collective agreements. The coming weeks are likely to show whether the board will respond to the criticism and make a new attempt to reach an agreement.

Volkswagen's stock continues to be rated "Neutral" by JP Morgan Chase & Co. The reports about the possible job cuts and the internal conflicts on the supervisory board caused uncertainty on the financial markets. "The uncertainty remains, which is not good for customers, employees, and capital providers," Dudenhöffer said.

Impact on plants and stock

The Zwickau and Emden sites are considered particularly at risk, as production capacities have already been reduced there. The works council had repeatedly emphasized in recent months that redundancies for operational reasons are ruled out. Whether this position can be maintained given the scale of the planned cuts remains open.

The federal government is observing developments at Volkswagen with growing concern. Volkswagen is considered one of the most important employers in German industry and a symbol of the country's industrial prosperity. Job cuts on the scale being discussed would have significant effects on suppliers, regions, and the labor market as a whole.