Volkswagen struggles with high labor costs in Germany, impacting competitiveness against rivals like BMW.

Volkswagen faces difficulties staying competitive in Germany due to high labor costs, spending between 15.8% and 17.5% of revenue on labor, compared to rivals like BMW and Mercedes-Benz, who spend between 9.5% and 11%. The high costs are partly because VW makes many components internally and employs nearly 45% of its workforce in Germany, where labor costs are the highest globally, averaging 62 euros per hour. Unions demand a 7% pay rise, while Volkswagen threatens a 10% cut, amid broader concerns about Germany's industrial competitiveness.

November 20, 2024
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