Volkswagen’s wage increase proposal has drawn criticism from its labor union.
On Tuesday, Volkswagen announced plans to offer new union members at its Tennessee assembly plant a 14% wage increase over four years and profit-sharing.
The automaker and the United Auto Workers (UAW) have negotiated contracts for several months following the union’s successful campaign to represent workers at the Chattanooga facility in April.
Volkswagen emphasized that this is the first time profit-sharing has been included in its contracts. It also pledged to enhance healthcare benefits for part-time workers at the plant.
However, Yogi Peoples, a UAW-VW bargaining committee member, criticized the offer.
“We’ve been bargaining for months, and VW is still not taking our demands seriously. With the record profits they’ve made and the dividend schemes they’ve used to pad the pockets of shareholders, there’s more than enough money to meet our demands for a record contract,” Peoples said in a statement.
The unionization at Volkswagen’s Tennessee plant marks a historic moment. UAW President Shawn Fain’s victory represents the first successful union election at a southern automotive factory since the 1940s and the first at a foreign-owned auto plant in the South.
Fain built momentum from a successful campaign in Detroit last year, where a six-week strike against Ford, General Motors, and Stellantis resulted in a 25% general wage increase and cost-of-living adjustments for workers.
Despite this, Fain and the UAW faced a setback in May when workers at the Mercedes plant in Alabama voted against unionization. The organization now focuses on organizing over a dozen non-union auto manufacturers nationwide, including Toyota and Tesla.
Meanwhile, Volkswagen is contending with growing labor tensions. The company has warned of potential job cuts or plant closures, citing a need to remain competitive with Asian automakers while managing costs.
Most Commented