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European Social Forum in Istanbul from 1 to 4 July 2010

Crisis in the Automotive Industry –Achieving social and ecological transformation

Contents

• Relevance of the European automotive industry

• Hallmarks of the crisis

• Extent of the crisis

• Social and ecological requirements

• Conditions needed to assert demands

• International labour operations: the Volkswagen Group

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European Social Forum in Istanbul from 1 to 4 July 2010

Relevance of the European automotive industry

• Western Europe, including new member states, accounts for 30% of worldwide auto production.

• 2.1 million employees in immediate core sector

• The livelihoods of 12 million employees overall depend on European automobile manufacturing

Source: Eurostat

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European Social Forum in Istanbul from 1 to 4 July 2010

Hallmarks of the crisis in the auto industry

• Cyclic / macroeconomic crisis, 15% to 25% surplus capacities

• Distribution crisis, income / taxation policy

• Financial crisis, speculation on financial markets rather than sustainable value creation (real economy)

• Ecological crisis, CO2 debate led to a structural crisis in the automotive industry due to shifts in demand

Comprehensive crisis for the capitalistic system

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European Social Forum in Istanbul from 1 to 4 July 2010

Extent of the crisis

• Automobile sales in Europe stagnating at high level

• Increasing significance of Asian producers

• Growing unemployment• through accelerated streamlining• through dwindling opportunities for temporary employment• through insolvencies in the sector for components supply• through plant closures, e.g. Opel Antwerp• through accelerated concentration processes

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European Social Forum in Istanbul from 1 to 4 July 2010

Gesamt Pkw

-

-

--

-

-

North America

+ 10 %

Asia/Pacific

UK

- 5 %

Germany

- 25%

- 1%

Spain

Italy

- 15%

Russia

+ 7 %

Western Europe

- 6 %

Worldwide passenger-car sales by regionForecast for 2010 against 2009 figures

- 11%

France

+4 %

Source: IG Metall, Volkswagen AG, own calculations

+ 6%

China

+ 23%

South America

+ 7 %

2009 = 52 million pass. cars in total2010 = 55 million pass. cars planned

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European Social Forum in Istanbul from 1 to 4 July 2010

Social and ecological requirements

Goals of equal importance:

- Preventing unemployment

- Ecologically viable mobility propositions

New focus in Europe: Sustainable investment in employment and environment instead of devising rescue parachutes for banks

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European Social Forum in Istanbul from 1 to 4 July 2010

Preventing unemployment

• Sustainable policies for industry that support transformation of the auto sector- Reduction of overcapacities- Safeguarding employment status quo through

development of new commercial fields- Training programmes

• Reduction of precarious forms of employment

• Reduction of working hours

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European Social Forum in Istanbul from 1 to 4 July 2010

Ecologically viable mobility propositions

• Development and production of environment-friendly automobiles through lightweight construction and the use of regenerative sources of fuel, e.g. electric cars

• Development of concepts for ecologically viable mobility propositions

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European Social Forum in Istanbul from 1 to 4 July 2010

Conditions needed to assert demands

• Transformation not as a threatening scenario for the workforce, but as an opportunity for sustainable protection of jobs and environment

• Transformation accompanied by training and social safeguards

• Transformation in one country not to the detriment of jobs in others (prevention of competition among sites)

• Transformation in concert with the workforce and trade unions (more co-determination)

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European Social Forum in Istanbul from 1 to 4 July 2010

Social Charter 1992

Charter of Labour Relations 200950 years of VW Law

20 years of Euro works councils

10 yeas of Group Global Works Council

International labour operations: the VW Group