Tensions Rise as Volkswagen Faces Possible Shutdowns

German Chancellor Olaf Scholz criticized Volkswagen's potential factory shutdowns amid disputes over pay cuts and plant closures. As negotiations continue, Scholz emphasized the responsibility towards employees and blamed poor management for the current challenges. He urged finding alternative solutions to avoid affecting jobs.

German Chancellor Olaf Scholz has expressed strong opposition to Volkswagen's potential factory shutdowns, labeling it a 'wrong move.' The Chancellor emphasized the responsibility Europe's largest carmaker holds towards its employees amid ongoing disputes over pay cuts and possible plant closures.

The conflict has stemmed from Volkswagen's efforts to counter high costs in Germany while facing fierce competition from cheaper Asian rivals entering the European market. Negotiations between the carmaker's management and labor representatives are set to enter their fourth round on Monday.

Scholz also pointed to poor management decisions as contributors to the company's challenging situation. Lower Saxony, Volkswagen's second-largest shareholder, and its premier have joined Scholz in urging the company to explore alternatives to avoid site closures.

(With inputs from agencies.)