Volkswagen managers and employee representatives are set to begin key negotiations in Hanover on Wednesday after the German group announced drastic cost-cutting measures are needed to keep the carmaker competitive.
At the meeting, two people from the company who have spent their entire careers at Volkswagen will face each other: CEO Oliver Blume and Works Council Chairwoman Daniela Cavallo.
Blume wants to approve a “package” of measures this year to support the carmaker, which is struggling with weak demand and a difficult transition to electric cars.
Cavallo has vowed “bitter resistance” to the plans which include the possible closure of production sites in Germany – an unprecedented move in Volkswagen’s 87-year history.
– The boss –
Blume trained as a mechanical engineer and worked at various brands including Audi, Seat and VW before becoming CEO of Porsche in 2015.
The mild-mannered 56-year-old manager was recruited by the family dynasty behind Volkswagen to become head of the group in 2022, replacing controversial figure Herbert Diess.
Blume was known as a proponent of consensus and was seen as a breath of fresh air after Diess had misled shareholders and unions with provocative statements.
It was therefore all the more surprising when Volkswagen announced this month that it would cut thousands of jobs by closing factories in Germany.
The shocking proposal alarmed unions and the government, but Blume said drastic measures were needed to address the “major challenges” facing the carmaker.
In his short time as CEO, Blume has already tried to solve Volkswagen’s problems, such as abolishing Diess’s do-it-yourself policy and establishing new partnerships.
The German giant has invested in Chinese manufacturer XPeng and American company Rivian to work on in-car technology, but it will take some time before the new projects bear fruit.
– The union leader –
Like Blume, Cavallo was born close to Volkswagen’s headquarters in the central German city of Wolfsburg and has never been far from the group.
Her father emigrated from Italy to Wolfsburg to work at Volkswagen, along with thousands of other so-called guest workers.
Cavallo, the first woman to head Volkswagen’s works council, began an apprenticeship at the car manufacturer after high school.
In 2002, she was elected employee representative at VW subsidiary Auto 5000. In 2021, she rose to chair of the general works council.
“My job is not to understand technology in detail, but to stand up for people’s interests,” Cavallo told the newspaper Die Zeit after being criticized for not spending enough time on the production line.
Cavallo is “very clear about what she wants for her employees,” said auto market expert Stefan Bratzel, who warned that management should not “underestimate” the 49-year-old.
Reportedly, she gets along better with Blume than with Diess.
According to Bratzel, there was a small chance that the two Volkswagen drivers could find a solution ‘together’.
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