Volkswagen reportedly plans to freeze pay for 660,000 employees until 2030

German automaker Volkswagen is reported to plan freezing the salaries of about 660,000 employees worldwide until 2030 as part of its restructuring. Cuts are also envisaged for bonuses and fringe benefits, in addition to fixed pay. The company's Global Works Council announced it had obtained internal information about management's plan.

What does the plan include?

According to information based on internal documents, management instructed human resources managers worldwide to maintain current pay levels and suspend increases. The new global guidelines, expected to apply from the last quarter of 2026, reportedly also cover variable pay, special payments and benefits, and include steps to reduce employment. However, the scope and implementation of these measures have not been confirmed.

If the plan goes ahead, employees' real income could fall by about 10% due to inflation. The move is seen as part of the company's effort to cut costs amid competitive pressure, weak demand in some key markets and the high costs of the transition to electric vehicles.

Reactions and next step

Volkswagen management declined to comment on the plan, describing the claims as speculation. A company spokesperson said proposals on labor costs could come up in a new round of talks expected this week.

The Global Works Council said it considered the plan unrealistic and expects it to meet strong resistance from employees. The German metalworkers' union IG Metall stressed that pay increases are determined through collective bargaining, not by unilateral board decisions.

New collective bargaining talks in the Volkswagen Group are expected to begin at the end of November. IG Metall is demanding a 5% pay rise for employees in the negotiations.