Volkswagen's Crucial Negotiations with IG Metall Amidst Electric Transition

Volkswagen and German unions are in intense negotiations to avoid plant closures and layoffs, which could lead to strikes. Talks have been ongoing since September with no compromise yet, but hopes for resolution before Christmas remain. The financial implications are also significant, affecting major shareholders.

Negotiations between Volkswagen and Germany's IG Metall union have reached a crucial phase as both parties strive to reach a deal before the end of the year. The discussions, aimed at preventing factory closures and mass layoffs, have become a battleground for Europe's top carmaker facing its biggest crisis in years.

After 36 hours of continuous talks that started on Monday, the automaker and union have reached a standstill over proposed cost cuts necessary for Volkswagen to compete against more agile Asian competitors amid a sluggish transition to electric vehicles.

The situation remains delicate, with Volkswagen advocating for tough cuts and potential plant closures, while unions vow resistance. The outcome could have significant financial ramifications, particularly for major shareholder Porsche SE, which has mentioned potential impairments due to ongoing uncertainties.

(With inputs from agencies.)