Volkswagen: “And now, it is anger”

Dossier compiled by H.-W. Shuster

Volkswagen announces tens of thousands of job cuts to boost profits

In Germany, 120,000 workers are on the payroll of Volkswagen (VW) car manufacturer, at its ten production sites. Ninety-five per cent of these workers are members of IG Metall union.

In its opposing the IG Metall demand for a 7% pay rise that covers the whole metalworking industry, the management of the VW group has cited the “collapse” of its profits. In 2023, however, the group distributed €4.5 billion worth in dividends to its shareholders!

But, as capitalists are never satisfied, the management is claiming a “financing requirement” of 4 to 5 billion euros. To achieve this, it has announced the closure of three plants, a 10% pay cut and wage freeze through years 2025 and 2026. The management is challenging the job guarantee that has been the rule for more than thirty years, so that it can start implementing redundancies as of the coming year.

Social Democratic Party (SPD) leaders’ policy

Following this announcement, the head of the federal government, Chancellor Scholz (SPD), declared that he was in favour of maintaining jobs. The SPD Minister-President of Lower Saxony also declared that he was in favour of keeping all the plants and called for “all parties to contribute to resolving the crisis”. On 30 October, the management of IG Metall eagerly welcomed these positions.

But the SPD leaders’ “deal” is a poisoned gift. In exchange for keeping jobs, they are proposing that workers accept a massive pay cut. However, we all know that accepting wage cuts has never saved one single job.

And yet, the SPD-led federal state (Land) of Lower Saxony, as well as the IG Metall leadership, could use the Volkswagen Act to stand up against the management’s plans. This law dates back to 1960, when VW was privatised; it gives guarantees to workers: the Land of Lower Saxony holds 20% of the group’s shares. And in the group’s supervisory board, where any decision can only be taken by a four-fifths majority, the unions hold ten of the twenty seats, which gives them a right to veto decisions.

But neither the SPD nor IG Metall leadership wish, today, to use this weapon of dissuasion!

Only one barrier: class struggle

Summarising the workers’ state of mind, IG Metall trade unionist Luigi Catapano explains: « First came fear, then disappointment, because we’ve never experienced anything like this at Volkswagen. And now, it is anger.”

Workers have heard the management’s statements about a “changing era in industry”. They know that, simply due to electric cars, 140,000 more jobs could be lost by 2035, while 50,000 have already been destroyed since 2019.

The first strikes this week show a broad mobilisation and a great fighting spirit. Thus we come to a decisive issue: will the union leadership counter this head-on attack of capital with workers’ fighting spirit and unity at VW and throughout the metal industry?

As he was participating in the summit convened by Scholz on 29 October, along with the VW boss, the President of IG Metall asked for public subsidies: « The brake of the debt should be eased or a special fund should be created.”

But if the objective is to preserve all the jobs without any pay cuts, a trade union that is mindful of its own history should demand that the State immediately renationalise the Volkswagen group, without any compensation or takeover. That is the response workers need.

‘If wages go down, profits go up’ (Karl Marx)

The conflict that the capitalists are waging at Volkswagen has only one objective: to increase profits by reducing the ‘cost of labour’.

We know that « if wages change, profits will change in the opposite direction. If wages go down profits go up; and if wages go up, profits go down » (Karl Marx, Wages, Prices and Profit).

At Volkswagen, the organised strength of the workers made it possible to wrest massive gains. Today, for capitalists, these gains must be destroyed so profits can be increased.

To achieve this, all barriers must come down. For example, the Liberal Party FDP (a member of the coalition government led by Social Democrat Scholz) demands:  » The State should completely privatise VW”. Capitalists and their governments are fighting for a drastic reduction in the ‘cost of labour’. To achieve this, they are stepping up the destruction of productive forces, de-industrialisation, relocation and deregulation. It amounts to a brutal devaluation of the ‘labour power’ commodity.