Volkswagen plant closures ‘not the right way’, Germany’s Scholz says

FRANKFURT (Reuters) – Factory shutdowns would be a wrong move by Volkswagen (ETR:), German Chancellor Olaf Scholz said, adding that Europe’s largest carmaker had a responsibility to its employees.

Volkswagen is in a bitter dispute with staff over pay cuts and possible plant closures aimed at countering high costs in Germany and massively cheaper Asian rivals entering Europe.

Both sides go into a fourth round of negotiations on Monday.

“Specific decisions will be negotiated between the owners and labour representatives. My opinion is clear: closing locations would not be the right way to go,” Scholz told the Funke Media Group.

“It would not be right because poor management decisions have contributed to the difficult situation,” he added.

The state of Lower Saxony is Volkswagen’s second-largest shareholder, and its state premier, like Scholz, has urged the group to avoid site closures.