Škoda Auto wage freeze: unions threaten strike at three Czech plants

Škoda Auto has been instructed to freeze wages, and the unions are threatening a strike. According to union officials, the carmaker's management admitted to employees for the first time that the situation is serious and could affect plant utilisation and employment in the future.

Unions: there will be no layoffs

Union leader Povšík said: “We are being asked to accept zero percent, no supplements, bonuses or premiums, while at the same time we are expected to do many times more work in electromobility.” He stressed that the Škoda Auto unions will not allow this.

“This is no longer solidarity, but an attack on honest workers. There will be no layoffs here! If that line is crossed, everyone at our three sites will halt production and will not back down until the situation is put right,” Povšík warned.

Profits are rising, wages are being frozen

The company's results are good, though: in the first half of the year, operating profit before interest, taxes and amortisation rose 140 percent to EUR 111 million, or roughly CZK 2.7 billion.

According to the German union IG Metall, Volkswagen plans to freeze the wages of all its more than 660,000 employees. The unions say the measure does not even provide for inflation indexation.

As the carmaker told the Czech News Agency in March, the average monthly earnings of non-management employees last year were CZK 81,691, including the base rate, bonuses, compensation and supplements. Since April, pay rates have risen by 3 percent, and in May employees received a variable bonus of CZK 120,000 and a one-off payment of CZK 20,000, a total of CZK 140,000.

The plants and the group's problems

Škoda Auto employs about 36,500 people, including agency workers. Besides the main plant in Mladá Boleslav, cars are built in Kvasiny in the Hradec Králové Region, and gearboxes are made in Vrchlabí. There are also plants abroad, for example in Slovakia and India.

The Volkswagen Group, which also includes Audi, Seat and Porsche, is facing a host of problems: high costs, growing Chinese competition and US tariffs. The group is therefore planning a large-scale restructuring, and the closure of four plants in Germany is not ruled out.

Around Prague, based on reporting by novinky.cz