Volkswagen proposes 14% wage hike and profit sharing for Tennessee workers

Volkswagen (VW) has offered a 14% wage increase over the next four years to its newly unionised workers at the Chattanooga, Tennessee plant. The proposal, made on December 11, also includes profit-sharing for the first time, alongside enhanced healthcare benefits for hourly workers.

The move comes after months of negotiations between the United Auto Workers (UAW) union and the automaker. The UAW, which secured the right to represent workers in April, had been pushing for better pay and benefits.

However, UAW-VW Bargaining Committee member Yogi Peoples criticized the offer. “VW is not taking our demands seriously,” he said, highlighting the automaker’s record profits and shareholder dividends. “They have more than enough to meet our demands for a historic contract.”

The VW plant in Chattanooga made history earlier this year when it became the first Southern auto plant to unionize since the 1940s. This victory followed a successful campaign by UAW President Shawn Fain, who secured a 25% wage increase for workers at Ford, GM, and Stellantis after a six-week strike.

While the Tennessee plant deal is still under discussion, the tension is also rising in Germany, where VW faces strikes as workers protest cost-cutting measures aimed at competing with Asian automakers. The company has warned of potential job cuts and plant closures in the face of increasing competition.

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