Germany's car crisis: Can the 35-hour workweek survive?
German carmakers want employees to work 40 hours instead of the current 35 without extra pay, arguing it would improve competitiveness. Unions strongly oppose the proposal and view it as an attack on workers' rights.
Germany's automobile industry is grappling with a severe crisis, driven by high manufacturing expenses, US tariffs, increased competition from China, and the challenge of transitioning to electric vehicles. Major players like Volkswagen, Mercedes-Benz, and BMW have announced plans to reduce production, cut costs, and downsize their workforce.
Volkswagen plans to eliminate around 15% of its global workforce, amounting to 100,000 jobs, by the end of the decade, while BMW intends to cut up to 8,000 jobs by 2027. Bosch and ZF Friedrichshafen are also facing job reductions. The automotive sector in Germany has seen a decline in employment from around 830,000 in 2018 to below 700,000 currently, with projections indicating it could drop to 500,000 by 2030.
Industry experts attribute the decline to rising costs, intensified global competition, and the need for better logistics and tax conditions. To address these issues, companies are urging employees to work 40 hours a week instead of the standard 35, without wage increases. However, workers' unions, such as IG Metall, strongly oppose longer working hours and argue that the industry's struggles stem from weak demand and underused factories rather than a lack of labor.
The union is organizing demonstrations against job cuts and other working condition changes. While lowering labor costs may help, it is essential to tackle the industry's broader structural problems, such as improving technology, efficiency, and competitiveness in areas like electric vehicles and software.
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