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Mercedes-Benz suspends investment at German sites as closures considered
Talks with employee representatives remain stalled as the carmaker seeks labor concessions and weighs the future of its German production sites.
Mercedes-Benz’s management board has temporarily halted further investment at its German sites as negotiations over cost savings remain deadlocked. Potential factory closures are receiving more serious consideration, although no affected locations have been identified.
HR director Britta Seeger cited cost pressures and said Mercedes must assess the long-term profitability of its German locations, according to media reports. She said the company wants to avoid closures but must examine that option more closely.
Seeger said in an internal interview that a quick agreement with employee representatives was not in sight, media reports said. Mercedes is seeking a package that combines substantial savings with socially acceptable measures.
Mercedes says hourly labor costs at its German factories can be up to five times those at Eastern European locations. Management is seeking changes to working conditions, including a proposal for longer hours at unchanged pay. Profit-sharing payments and holiday and Christmas bonuses could also be reduced. Employees have protested the demands.
Production chief Michael Schiebe previously warned that two German plants could close if cost reductions do not materialize. The potential closures would involve a vehicle assembly factory and a powertrain facility producing components. The works council and IG Metall are seeking to protect jobs and collectively negotiated benefits.