European Union Chief Warns of Unrest at VW

LAS VEGAS – Expect “hot confrontation” from German trade unionists if Volkswagen AG continues its attempts to extend the auto maker’s 4-day workweeks in Germany without increasing wages, says the International Metalworkers’ Federation’s top official.

And it is no coincidence that VW’s latest proposal to extend working hours, partly in exchange in part for producing the next-generation Golf in Germany, echoes one negotiated last year with IG Metall, says IMF General Secretary Marcello Malentacchi.

Germany’s auto workers union earlier agreed to change work rules in exchange for the right to build the upcoming Marrakesh cross/utility vehicle in Wolfsburg.

“I think it is a strategy,” Malentacchi tells Ward’s after addressing the United Auto Workers’ 34th Constitutional Convention here. VW’s plan is to divide and conquer, Malentacchi says, first dangling new vehicle programs as incentives, then threatening the future of existing production, as it pressures IG Metall for labor concessions.

VW’s proposal for an increase in the workweek from 28.8 hours to 35 hours, without a corresponding hike in pay, in exchange for job security was rejected by IG Metall June 13.

“When they can’t guarantee those jobs, I think it will be very difficult for the union to accept (new work rules),” Malentacchi says, noting the global business climate, not management style, is forcing change.

IMF General Secretary Marcello Malentacchi

Horst Neumann, Volkswagen AG board member for human resources, warns efforts to reduce labor costs “must succeed.”

“Competition is setting a fast pace,” Neumann says in a statement released June 12. “Lower labor costs, high productivity and first-rate quality safeguard Volkswagen’s competitiveness. Under these conditions, capacity utilization at sites can also improve.

“Taken together, this is what is needed to safeguard jobs, a duty we as a company continue to take very seriously.”

Ironically, Neumann was a longtime IG Metall official before his appointment to Volkswagen’s board last year.

In Malentacchi’s address to UAW convention delegates, which was interrupted numerous times by enthusiastic applause, he urges the UAW to seek “international framework agreements” with Japan-based auto makers such as Toyota Motor Corp. and Honda Motor Co. Ltd., each of which are contemplating new plant investments, adding to their combined total of six assembly sites.

An international framework agreement “is a global instrument with the purpose of ensuring fundamental workers’ rights, including the right of all workers to form and join unions of their choice, to collectively bargain and to strike in defense of their rights.”

The IMF, comprised of more than 200 unions in 100 countries, has 15 such agreements with Europe-based auto makers such as Renault SA and PSA Peugeot Citroen, Malentacchi says.

But his group has been unable to get Japan-based auto makers to agree and, he concedes, the UAW also will find the task difficult.

“Corporations are crossing national borders, so too must our solidarity efforts,” Malentacchi tells the convention. “Only by coming together in a united global front can we challenge the power structures that exploit (workers).”

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