In Germany's Stalled Economy, Job Security Deals and Strikes Paint Divergent Picture
02.07.2026 - 20:53:07 | boerse-global.de
For nearly 4,000 workers at automotive supplier Mahle in Stuttgart and Kornwestheim, the path to keeping their jobs runs through their pay packets. The employees are forgoing their 2026 tariff wage increase as well as Christmas and holiday bonuses. In exchange, they receive a guarantee against dismissal through the end of 2029 — though the company holds an opt-out clause effective 31 December 2028. The forfeited special payments are converted into paid leave days.
Mahle posted revenue of €11.26 billion in 2025, down from €11.68 billion the prior year, while profit shrank from €22 million to €20 million. Management blames the weak auto market, the shift to electric vehicles, intensifying competition from Asia and new US tariffs.
A few hundred kilometres north, the atmosphere at Mercedes-Benz is radically different. The IG Metall union has called for nationwide rallies on 3 July. Organisers expect thousands at plants in Sindelfingen, Untertürkheim, Bremen, Berlin and Hamburg — Bremen alone anticipates 5,000 participants. The trigger: roughly 90,000 of the company’s 108,000 employees are set to lose an expected July payout of the so-called "transformation component", equivalent to 18.4 percent of monthly salary, which management now says will not be paid until 2027. The board is also demanding longer hours for the same pay. Mercedes-Benz saw its first-quarter 2026 profit fall 17.2 percent, having already tumbled from €10.4 billion in 2024 to €5.3 billion last year.
The turbulence is not confined to automotive. In East Westphalia, two traditional breweries are facing collapse. The Haus-Cramer group intends to shut the Herforder brewery at the end of August, eliminating roughly 100 jobs. Meanwhile, the Paderborner brewery, with 120 workers, is up for sale — even though employees there have waived tariff increases since mid-2021 under a job-security pact running through 2028.
Simultaneously, the retail sector is heading for a confrontation. The Verdi union has called for nationwide warning strikes on 3 July. Employers are offering a 2.4 percent raise starting November 2026; Verdi demands 7 percent over a twelve-month term.
Volkswagen is contemplating a strategic pivot. To stabilise up to 100,000 at-risk jobs worldwide, the company is considering assembling Chinese-developed models at plants in Zwickau, Hannover and Emden. The Zwickau works council is pressing for firm model allocations.
These company-level moves are unfolding against a broader labour-market overhaul planned by the black-red coalition government. Proposed measures include allowing fixed-term contracts without a specific reason for up to 48 months (through 2030), easing dismissals for high earners with monthly salaries above roughly €15,000, and offering tax incentives for severance packages tied to swift job changes. The government also intends to abolish the telephone sick-note system.
