German car manufacturers are advocating for a shift from a 35-hour workweek to a 40-hour workweek without additional pay, citing the need to enhance competitiveness. Unions have expressed strong opposition to this proposal, viewing it as a threat to workers' rights.
The automotive sector in Germany is currently facing significant challenges, including high manufacturing costs, US tariffs, increased competition from China, and the transition to electric vehicles. Major companies like Volkswagen, Mercedes-Benz, and BMW have announced plans to reduce production and cut costs.
Volkswagen aims to reduce its global workforce by about 15%, equating to approximately 100,000 jobs, by the end of the decade. Similarly, BMW plans to cut up to 8,000 jobs, representing about 5% of its workforce, by 2027. Auto suppliers such as Bosch and ZF Friedrichshafen are also implementing job reductions due to challenging market conditions.
Ferdinand Dudenhöffer, director of the Center for Automotive Research (CAR) in Bochum, stated that the industry employed around 830,000 people in 2018, but that number has fallen below 700,000, with projections suggesting it could drop to 500,000 by 2030. He emphasized that regaining competitiveness and securing future jobs will require measures such as lowering production and energy costs, improving logistics infrastructure, and favorable tax conditions.
Industry executives have noted that labor costs in Germany are significantly higher than in international competitors, averaging $3,307 (€2,882) per vehicle compared to $769 in Japan and $597 in China, according to a report from consulting firm Oliver Wyman.
The 35-hour workweek has been a standard in the automotive industry since the 1980s and 1990s, reflecting a time when Germany was more competitive. Dudenhöffer remarked that this era has ended.
Unions, however, argue that the issue lies not in labor hours but in weak demand and underutilized factories. Christiane Benner, head of the IG Metall trade union, stated that workers have already accepted significant concessions and should not be asked to work longer hours without additional pay. The union plans demonstrations at over 200 locations on September 21 to oppose job cuts and changes to working conditions.
Dudenhöffer noted that moving to a 40-hour workweek could reduce personnel costs by 13%, but emphasized that simply increasing hours will not address the industry's deeper structural issues. Experts agree that improving labor costs is necessary, but it must be accompanied by innovations in electric vehicles, software, and manufacturing efficiency.
Bratzel highlighted that the competitive landscape requires German manufacturers to be as innovative as they are costly. He also pointed out the need for reforms in energy, taxes, bureaucracy, and infrastructure to restore competitiveness. Dudenhöffer echoed this sentiment, stating that Germany must pursue necessary reforms to ensure the viability of its automotive industry and jobs. He warned that the coming years will be challenging if the industry does not adapt to current realities.