pc 22 settembre - Scioperi alla Volkswagen Germania

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Germany: cutting plans at Volkswagen – “social peace” continues to crumble

We publish an unofficial translation of an article by Dem Volke Dienen:

Last Wednesday morning, the management of the Volkswagen AG (VW), the largest monopoly of German imperialism in terms of sales, officially informed the workers at the main plant in Wolfsburg about the company’s cutting plans, which had already been made fundamentally clear at the beginning of the week: the job security accord that was valid until 2029 is to be terminated, and even the closure of entire plants, which would be first timer for VW in Germany, is on the table.

25,000 employees, primarily on site, the smaller part of which was connected via video, expressed their displeasure with a chorus of whistles and boos. The reactions reached the highest ranks of the state leadership, where members of the SPD, which is closely intertwined with Volkswagen, such as

exploitation minister Hubertus Heil or Lower Saxony’s Prime Minister Stephan Weil, tried to play the caretaker.

With an annual turnover of almost 350 billion dollars, Volkswagen is also the world’s top car manufacturer and 11th largest company in the world. Its plant in Wolfsburg is also the largest contiguous factory in the world in terms of over 60,000 employees and production volume.

Since “Volkswagen” was founded by the fascists and their “union”, the German Labor Front, as an affordable vehicle for the masses who support the state, the company from the Mittelland Canal has been a prime example of corporatism in Germany and could not help but fall into the hands of the Social Democrats and the yellow unions under their control. The Federal Republic of Germany holds 11.8 percent of the shares of VW and 20 percent of the voting rights through the state of Lower Saxony, which is also seen as a “training ground” for the careerists of the SPD and IG Metall [Translator’s note: Metal workers union] – both of which are tied to the Volkswagen monopoly (for example, the IG Metall board and supervisory board and Prime Minister Weil sit on the supervisory board). At VW, the state (which of course has a special right of co-determination), the company and the union shake hands, and in some cases they are one and the same.

This only works as long as the workers go along with it, and this necessity coincides with the fulfillment of the “social contract”, i.e. the German version of bribing broad sections of the population with imperialist extra profit so that they “go along with the state” and “social peace” is maintained. Accordingly, in the VW factories, as in all German car monopolies and in almost all large national industrial companies, there is are permanent workers that make up the majority of production, whose gross wages in the car industry generally do not start below 3,500 euros. The majority of the permanent workers are working on the assembly line – mainly in assembly – and in the normal shift system earn just over 3,000 net per month. All this with a 35-hour week and some “additional offers” from the exploiter. On the other hand, their position in the production process is low, they often have to do the same task for years in rotating shifts and are in most cases unskilled. In summary, VW’s core workforce consists largely of people from the upper echelons of the proletariat, followed by countless working-class aristocrats. This is a group whose economic position is currently threatened by the crisis in German industrial companies.

“We are lacking the sales of around 500,000 cars, sales for around two plants,” said VW CFO Antlitz on Wednesday, explaining the austerity measures. First and foremost, this is another expression of the deep economic crisis of imperialism, a crisis of overproduction.

The number of cars produced worldwide has fallen sharply since the beginning of the crisis; in 2017 it was 97.3 million, but in 2022 it was only 85 million. Likewise, sales in the “manufacturing industry” in Germany reached a level in 2017 that it has not reached since then. At best, the pre-crisis level was briefly glimpsed at the end of 2022. Since then, things have been going down almost steadily and sales are far worse than in the second Corona year of 2021. The number of orders has been falling since the end of 2021, which can of course be somewhat ahead of the falling sales – see the example of Meyer Werft below. Finally, this July, sales in the “manufacture of motor vehicles and motor vehicle parts” also took a big leap back and are currently below the 2021 level.

German imperialism is continuing its strategic plans, such as the principle of “size matters” laid down in the “National Industrial Strategy”, i.e. the big eats the small. For example, around one in five self-employed people or small business owners who received emergency Corona aid must now pay it back in full or in part. The number of company bankruptcies in Germany is increasing.

In recent weeks and months, there have been increasing reports of layoffs at important German industrial companies, particularly in the automotive sector, such as Bosch or the parts manufacturer ZF, but also at other light industry companies such as the Meyer Werft and heavy industry, where BASF, for example, announced the layoff of 1,700 workers last February and is now dismantling several factories on what some sources say is its largest factory site in the world in Ludwigshafen, and ThyssenKrupp wants to cut numerous jobs after a financial year with billions in losses (the next SPD careerist from Lower Saxony, ex-Vice Chancellor Sigmar Gabriel, only left as head of the steel division on August 29th); even the main site in Duisburg is at risk.

The fact that Germany is currently being hit much harder than many imperialist competitors is also due to its own special reasons within the overproduction crisis. While Germany emerged as the big winner from the “financial crisis” at the end of the 2000s, Germany has so far been the “sick man of Europe” in this crisis, having experienced negative economic growth last year in contrast to almost all other major “national economies”. And just on Thursday, the ifo Institute once again revised its economic forecast downwards and expects stagnation in 2024; the Kiel Institute for the World Economy (IfW) is expecting a second year of recession.

German imperialism has so far failed to fulfill its strategic plans in its quest to develop into a superpower and has hardly been able to break free from political, military and economic dependence on Yankee imperialism, which is evident, among other things, in the war in Ukraine and the renunciation of Russian gas (incidentally, the sale of the Port of Hamburg to the Swiss shipping company MSC was also finally approved on Thursday). Here is one of the key points – energy independence – which has not yet been achieved even with the many wind turbines and which has not exactly accelerated the promises of the Green governing party to its electorate regarding nuclear power.

Cheap electricity and gas play an important role here, as the ifo Institute also writes: “On the other hand, structural change is particularly affecting the manufacturing industry, which accounts for a significantly larger share of economic output in Germany. The energy-intensive industries that are reacting to the high energy costs, as well as mechanical engineering and the automotive industry, which are exposed to increasing competition from China in addition to restructuring in connection with decarbonization and digitalization, are more important than in other countries.”

It is becoming increasingly difficult to prevail against competition from China, partly because of energy costs. The problems at VW therefore arise in particular from the political handling of the crisis. Workers council leader Daniela Cavallo takes the same approach when she accuses the VW board of “not doing its job properly”. This means that IG Metall is again following the same path as the current opposition parties and explaining all problems as consequences of the poor handling of the bourgeoisie, i.e. if the handling of the state and “corporate policy” improves again, the problems will also disappear.

In this respect, the billion-dollar union, which is controlled by the SPD and intertwined with the monopolies, is once again bringing the demands of business representatives and the governing Social Democrats to the table: cheaper industrial electricity prices (highly promoted by Scholz and Habeck, among others) and especially the four-day week already known at VW (Heil and Weil, following in the footsteps of careerists Peter Hartz and Gerhard Schröder). These measures can help the company – and come at the direct expense of the working class. IG Metall boss Christiane Benner expressed it pragmatically on Thursday when she proposed the four-day week, an “alternative” method of destroying productive forces, for VW: “We should not leave any ideas unused as to how we can preserve employment and locations.” It is quite daring to make such a statement before the upcoming collective bargaining round for the metal and electrical industry (i.e. also for the automotive industry), in which IG Metall has entered with other demands.

IG Metall has been campaigning for a strengthening of state monopoly capitalism, which is a core need of German imperialism, for some time. In the current issue of their newspaper, an economic researcher calls for 600 billion euros of state investment over the next ten years in “public areas”, especially in infrastructure, which is also a military necessity.

There are also other factors for the crisis at VW – not to forget the government’s inability to draw up a budget and the consequences of this for the monopolies, or the fact that the entire VW top management has been proven to be recognized as criminals even under civil law (ex-boss Winterkorn is currently facing trial for the diesel scandal). There is also criticism of the handling of e-car production, where many see a delayed transition. Car expert Ferdinand Dudenhöffer, in whose eyes “the battle for electric vehicles is being fought in China”, criticizes the company as a “state-owned company” (in reference to the bureaucracy and social democrats who only enrich themselves from it) and the government for the high protective tariffs of up to 36.3 percent on Chinese electric cars in Europe (which were introduced because of alleged “distortion of competition”), which is also slowing down the development of electromobility in Germany and costing German car manufacturers influence in China, by far the largest sales market in the world.

What the austerity measures are primarily about is the core brand Volkswagen, i.e. the largest and most important of many brands at home and abroad owned by Volkswagen AG. For many, a cheap car from the VW subsidiary Skoda (Dudenhöffer emphasizes its profitability) is more worthwhile than a more expensive but only slightly more useful VW. Since production in the imperialist countries themselves is apparently proving to be too costly, cuts must be made here in particular.

Of course, when layoffs are made, the lowest ranks (temporary and foreign workers) are always the first to be targeted, but the number of people affected at VW is now also attacking the broad social cushion of the upper layers of the proletariat and worker aristocrats bribed by imperialism, which is primarily found in industry and in the automotive sector. This further shows the collapse of the so-called “middle class” and the “social support” that was an important basis for German imperialism for decades. The economic crisis of imperialism is affecting ever broader sections of the population. In various industrial companies, tens of thousands of employees, particularly from the upper echelons of the proletariat, are currently taking to the streets for their future – and the “social peace” that was bought from the start in the Federal Republic of Germany is crumbling.

VW-factory in Wolfburg; Source: Dem Volke Dienen