Zerohedge;

As discussed earlier today, Germany’s economy is slowly but surely sinking, whether or not Mario Draghi’s proposal to flood Europe in new debt is eventually accepted, and nowhere is the pain more tangible than Germany’s iconic carmaker, Volkswagen, which we reported last week was considering its first-ever factory closure amid a dire economic backdrop, and which today took the shocking – for Germany – decision to end job protections for German auto workers as part of its cost-cutting push, setting up a calamitous showdown with unions as the country’s most important industry fights for its future.

This morning, the world’s largest automaker by sales canceled several agreements linked to a three-decades-old pact that was supposed to safeguard employment until 2029, V. […]

VW’s main target is its underperforming namesake passenger car brand, whose profit margins are getting squeezed amid a sputtering transition to EVs and a consumer spending slowdown. Carmakers in Europe are also struggling to compete with Tesla and new entrants from China led by BYDl, which have been selling cars at dumping prices, infuriating Brussels.

Cutbacks at VW are harder to push through than at other companies, especially since half the seats on the company’s supervisory board are held by labor representatives, and the German state of Lower Saxony — which owns a 20% stake — often sides with trade union bodies. The automaker, which employs almost 300,000 Germans, last week defended its plant closure plans, saying flagging car sales have left it with about two factories too many.

h/t MelindaPrevious.