Volkswagen workers lay down tools in first warning strikes

Workers at Volkswagen announced plans for lightning strikes at all of the ailing car giant's six German plants from Monday as the company's attempts to reach a deal with the unions over its cost-cutting plans remained deadlocked.

The strike pledge by the IG Metall, the metal workers union, followed hour-long strikes at VW plants in Brunswick, Hanover and Kassel early yesterday morning, as workers stepped up demands for a 2 per cent wage increase and job guarantees after talks with company negotiators brought no results on Thursday.

IG Metall said it wanted to extend its strike programme to two other plants, including the company's main factory at Wolfsburg, on Monday when talks with the management are set to continue.

Hartmut Meine, the union's chief negotiator said: "We are confident that we can secure job guarantees, although the management side has refused to back down from any of its cost-cutting proposals."

VW, which is the third German car giant to face a tough battle with the unions over production costs this year, reported a 44 per cent drop in profits on Thursday. Like its competitors, VW's profitability has been eroded by intense competition from abroad, a strong euro and the second highest labour costs in Europe.

In an attempt to reduce costs by 30 per cent over the next six years, the company has demanded an across-the-board, two-year pay freeze for the 103,000 workers at its six plants in West Germany. Unconfirmed reports have suggested that VW management has plans to shed up to 15,000 jobs at its German plants over the next decade if no deal can be reached.

Josef-Fidelis Senn, the company's chief negotiator complained yesterday that the unions were dragging their feet during the talks, which entered their fifth round on Thursday. "One has the impression that IG Metall is moving at a speed that unfortunately doesn't fit in with reality," he said.

His remarks were underscored by Bernd Pischetsrieder, VW's board chairman, who said: "With the best will in the world, I cannot say how the talks will progress. Volkswagen cannot be allowed to get into a situation in which plants are shut and jobs are lost. The management's offer is on the table. We want a wage freeze."

The dispute at VW follows last week's wave of industrial action by 50,000 workers at the loss-making General Motors' plants throughout Europe. The strikes and demonstrations were held in protest at the company's plans to axe some 12,000 jobs on the Continent and in Britain under a €500m saving programme. The strongest protests were in Germany, where 10,000 GM redundancies were mooted last week.

GM's board has still not ruled out the possibility of job losses. However, the strikes were called off after GM decided not to close three major German GM plants provided they remained competitive. Earlier this year Daimler-Benz reached a cost-cutting deal with unions which will save 6,000 jobs at its German plants.