Works council conflict at VW continues to escalate

According to media reports, the VW works council has issued a vote of no confidence in Herbert Diess. A mediation committee has now been set up in the supervisory board. The dispute is about possible massive job cuts – but also about the role of the individual plants in the transition to electric mobility.

As reported by the German publication Handelsblatt, among others, citing company circles, not only the works council has turned against Diess, but also supervisory board member and Lower Saxony’s Minister President Stephan Weil is said to have backed away from Diess; according to the report, both parties were very unhappy about Diess’ previous actions. For example, at the supervisory board meeting at the end of September, when he suggested cutting 30,000 jobs. Or with the plan to fly to an investors’ meeting in the USA instead of attending the works meeting scheduled for this Thursday in Wolfsburg. The fact that he had not invited works council chairwoman Daniela Cavallo to his information event was apparently not important.

The Handelsblatt sees the expressed mistrust and the now appointed mediation committee as the “prelude to a discussion at the end of which he could lose his post”. In addition to the anger about the possible job cuts and the internal attitude towards the powerful works council, the report says that the supervisory board also criticised the operative business – for example, the figures from China and the problematic start-up of new models.

While the works council continues to strongly criticise the group boss even after the change at the top from Diess’ long-time adversary Bernd Osterloh to Daniela Cavallo, Porsche SE continues to stand behind Herbert Diess, according to the report. The holding company, in which the Pirsche and Piëch families have bundled their shares, is not represented in the mediation committee, but is involved in the talks.

Until the mediation committee reaches a result – possibly by the beginning of December – important decisions in the operative business will be suspended. These include investments that have not yet been approved. For this reason, some insiders say that the company is currently “blocked”.

Herbert Diess wants to continue to focus the company on electromobility and, for example, strengthen in-house software development. In addition, the plants are to become more efficient – the conflict with the works council recently escalated at the main plant in Wolfsburg. The works council did not oppose the change to electromobility, but rather the way Diess is pushing his course.

As reported, a compromise had emerged that Wolfsburg could receive the overflow production of the ID.3 and ID.4 from Zwickau – and would thus enter electric car production before the electric vehicle flagship announced for 2026. The so-called planning round, in which Volkswagen distributes models among the worldwide plants (and thus influences their capacity utilisation) had to be postponed most recently from mid-November to December.

With reporting by Sebastian Schaal, Germany.

handelsblatt.com (in German)