Volkswagen Union Holds Mass Demonstration

Sept. 12, 2008
The workers' issues are with Porsche's boss and the European Commission.

Workers began gathering at Volkswagen headquarters on Sept. 12 for a mass demo against two companies they see as threatening their jobs -- Porsche's boss and the European Commission. The official reason for the protest in Wolfsburg, at which unions expect some 30,000 whistle-blowing demonstrators to take part, is to demonstrate against the EU's wish to do away with the so-called VW Law.

The VW Law dates back to 1960 and effectively blocks another company making a hostile takeover bid for Europe's biggest carmaker as it gives the state of Lower Saxony a blocking minority over major company decisions. The European Commission has taken a dim view of the law because Lower Saxony only holds a 20% stake in VW. Normally a blocking minority is only accorded to those owning more than 25%. The law, which is also defended by Germany's federal government, was struck down in October by the European Court of Justice, which ruled that it violated competition laws.

Berlin redrafted the legislation to respond to EU objections but maintained the provision that gives Lower Saxony its effective veto, and a Commission spokesman said this week that it would bring new court action against Germany.

IG Metall, which represents 90% of VW employees, fears that a foreign buyer would endanger jobs and encroach on workers' rights.

But workers at VW, which last month said it had overtaken Ford to become the world's biggest automaker behind General Motors and Toyota, also have another target in their sight: Porsche chief Wendelin Wiedeking. Porsche already owns more than 30% of VW's capital and is due to make an offer to buy the rest of the much larger firm later this year. It is a deal that would see a family-controlled company that makes 100,000 expensive sportscars a year take over a national institution that churns out five million vehicles for the masses in the same period.

But relations between worker representatives and Wiedeking, who already holds a seat on VW's board, are far from warm, with the Porsche boss already warning there would be no "sacred cows" once his firm is in control.

Copyright Agence France-Presse, 2008

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