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Germany's Big Three Are Almost Shut Down By The Strike Boom And Auto Industry

Feb 26, 2018

The most massive strike in Germany in 34 years has finally settled. Previously, the German Metal trade Union (IG Metall), the largest European society that represents the rights and interests of German machinery, metallurgy, automobiles and electronics employees, had demanded a 6% per cent rise in wages for 3.9 million employees.


After being rejected, IG Metall called on workers in Germany to hold strikes to raise wages and shorten work hours, a move that had almost completely shut down the entire German auto industry and aircraft manufacturing industry. It is worth mentioning that workers from high-end carmakers, such as Audi and BMW, are involved.


After 6 rounds of negotiations, February 7, IG Metall and the southwest Metal Electric Employers Association finally reached an agreement: from April 2018 onwards, workers pay 4.3%, allowing workers under certain conditions to change the weekly working hours to 28 hours to take care of the child, the sick family or the elderly, Resume normal work after up to two years. At the same time retain the right to return to full-time work, the agreement is valid until the end of March 2020.


According to the securities daily, the background of the Labour agreement was the 2003 German labour market reforms and the financial crisis that swept the world in 2008, which led to a prolonged period of wage growth for many workers, with only 0.81% per cent of average wage growth over the past decade. At the same time, the German economy grew at its fastest pace in 2017, up 2.2%, while the unemployment rate was only 5.4% at its lowest level in 1990 years.


In this regard, the trade unions believe that the German economy has been growing at a high rate for 6 years, unemployment has reached a record low, and the big auto factories are profitable, and industrial workers should share this economic dividend. On January 8, the guild made a request to employers to allow workers to reduce their weekly working hours to 28 hours under certain conditions and raise the salary by 6%. After being rejected by employers, the unions called on workers to launch dozens of strikes of unequal size.


Since the end of January, Germany's Württemberg, NRW and Bremen have already had some of the factory's night-shift production plans frustrated, with only Germany's NRW 30 metal industry companies to take part in the strike. Some 7,000 employees at the company's headquarters in the Anglo-Gore plant began a strike, while BMW's 4 factories in Bavaria were shut down for more than 24 hours; Baden-Württemberg, Daimler (Mercedes-Benz) and Porsche began a 24-hour strike in Friday.


In addition, the Rhine-Rhein, Hessen, and Berlin's Daimler and Opel companies joined the strike: the Mercedes-Benz plant near Berlin, BMW factory, Thales and Siemens mobile traffic all shut down. Another 18 auto parts companies took part in the strike, including Bosch, ZF, Schaeffler, Mahler, Gottlack and Grammer. It can be said that the entire German auto industry almost shut down.


In this respect, BMW spokesman Johenfray said: "This dispute has entered another dimension." A sustained strike would affect at least four-digit car production. It is reported that the BMW Munich factory three-hour strike, has caused 250 cars can not be assembled.


Audi then said the two strikes in the Anglo-Neckarsulm area had affected the assembly progress of 700 cars. Some economists say the strike has had a heavy impact on the German car, aircraft industry and electronics industry and is expected to cause at least 1 billion euros in losses.


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