EMCC European Monitoring Centre on Change

Volkswagen

Company/Organisation:
Volkswagen

Geographic Location

Country: Belgium
Region: Région Bruxelles-Capitale / Brussels Hoofdstedelijke Gewest
Location of affected unit(s): Forest plant

Company

Sector: Manufacturing
Manufacture of transport equipment
29.1 - Manufacture of motor vehicles
Number Employed: 5400
Group: Volkswagen

Employment Effects

Announcement Date: 21-11-2006
Planned Job Reductions min: 3200
Planned Job Reductions max: 3200
Type of Restructuring: Offshoring/Delocalisation
Direct Dismissals: 300
Other Job Reduction Measures: 2900

Additional Information

On Tuesday 21 November 2006, the management of the Volkswagen plant located at Forest in Belgium (Brussels Region) announced that the production of the Golf, previously done mainly by the Brussels plant, will soon be partly relocated to the German plant at Wolfsburg (the group headquarters). This decision will involve the loss of 3,200 jobs out of the 5,400 previously employed at Forest. The workers cannot understand the reason for this decision, particularly since production in the German plant is more expensive than production in the Belgian plant. It should be noted that the restructuring will also lead to the loss of many jobs among subcontractors and suppliers of the plant since many of them work exclusively for Volkswagen Forest. Consequently, even if it is still quite difficult to evaluate the entire impact of this decision, a joint study carried out by Agoria (an employers’ organisation) and the National Bank estimate that the total number of jobs lost (directly and indirectly) could range between 10,500 and 12,000. A social plan was negotiated in December 2006. Out of the 5,400 workers employed at Forest, 2,200 of them will continue to work at the plant, since 84,000 cars will be produced at Forest in 2007 and in 2008. With regard to the others, about 900 will receive early retirement and about 2,000 will leave the firm voluntarily (in return, they will receive compensation which will vary between EUR 25,000 and EUR 144,000).

For further information, see the EIRO report.