Volkswagen (VW) has made a deal with the IG Metall trade union. This deal will stop plant closures in Germany and avoid job losses for now. However, they have agreed to cut over 35,000 jobs in a careful way by 2030. This will help save about €15 billion (£12.4 billion).
VW thought about closing up to three factories because they wanted to save money. They also asked workers to accept a 10% pay cut. The union wanted a 7% pay raise instead.
The deal includes some changes to production. Union leaders are happy about the agreement. They said no factories will close and no one will lose their job because of work reasons. Workers will also keep their wage agreement for a long time.
The job cuts might happen through things like early retirement. A planned 5% pay raise will be stopped in 2025 and 2026 to support the company.
The number of apprenticeships in Germany will go down from 1,400 to 600 from 2026. VW is looking at moving some production to Mexico. German Chancellor Olaf Scholz welcomed the deal, calling it a good solution.
Vocabulary List:
- Closure /ˈkloʊʒər/ (noun): The act of shutting down a business or operation permanently.
- Negotiation /nɪˌɡoʊ.ʃiˈeɪ.ʃən/ (noun): The process of discussing something in order to reach an agreement.
- Apprenticeship /əˈprɛntɪsʃɪp/ (noun): A system of training a new generation of practitioners in a trade or profession.
- Retirement /rɪˈtaɪərmənt/ (noun): The action of leaving one’s job and ceasing to work.
- Production /prəˈdʌkʃən/ (noun): The process of creating goods and services.
- Agreement /əˈɡriːmənt/ (noun): A negotiated and typically legally binding arrangement between parties.
How much do you know?
What is the purpose of the deal between Volkswagen and IG Metall trade union?
How many jobs are VW planning to cut by 2030 as per the agreement?
What was the percentage of the pay cut that VW asked workers to accept?
What will happen with the planned 5% pay raise in 2025 and 2026 as per the agreement?
How many apprenticeships are expected in Germany from 2026 onwards?
Which country is VW considering moving some production to?
The deal between VW and the union will lead to plant closures in Germany.
Workers at VW have agreed to a 7% pay raise as requested by the company.
According to the agreement, no one will lose their job due to work reasons.
The number of apprenticeships in Germany will increase from 1,400 by 2026.
The German Chancellor is against the deal between VW and the union.
The agreement includes a provision to stop the pay raise in 2025 and 2026.
VW is planning to cut over jobs by 2030.
The number of apprenticeships in Germany will decrease from 1,400 to by 2026.
The planned 5% pay raise will be stopped in to support the company.
The deal between VW and the IG Metall trade union will prevent plant closures in .
Union leaders are happy about the agreement as no factories will close and no one will lose their job due to reasons.
German Chancellor Olaf Scholz welcomed the deal, calling it a solution.
