Mercedes-Benz suspends German plant investment and weighs closures
The carmaker is seeking labour concessions as negotiations with employee representatives remain deadlocked. Two plants could close if savings do not materialise.
Mercedes-Benz's management board has suspended further investment at its German sites for now, amid a dispute over production costs and stalled negotiations with the works council and IG Metall. The carmaker is also giving more serious consideration to closing plants.
HR director Britta Seeger said the company needed to assess which German locations could remain profitable over the longer term. She said Mercedes wanted to avoid closures where possible, but that the option required closer examination. No quick agreement with employee representatives was in sight, she said.
Mercedes says hourly labour costs at its German factories can be up to five times those at its Eastern European sites. Management is seeking changes to working conditions, including a proposal for longer hours without additional pay. Profit-sharing payments and holiday and Christmas bonuses could also be reduced. The demands have prompted employee protests.
Production chief Michael Schiebe had previously warned that two German plants could close if cost reductions were not achieved. The sites under consideration would comprise a vehicle assembly factory and a powertrain plant producing components. No specific locations have been identified.
Seeger said the goal remained an agreed savings package that was socially acceptable. The works council and IG Metall are seeking to protect employment and benefits covered by collective agreements.
