Volkswagen Navarra, 8th Collective Agreement (A): An agreement for the future

In September 2012, Carlos Escobar, director of human resources for the Volkswagen plant in Navarra (hereafter, VW Navarra), was sitting in his office reading the mail that his secretary left him on his desk each morning. That day, the first letter in the pile was from Germany, signed by Herbert Waltl, the production manager for all the European Volkswagen (VW) plants. After reading the letter, Carlos called Patrick Danau, general manager of VW España, and asked to meet with him that morning to discuss a last-minute development: "Patrick, we need to revoke the labor agreement and start negotiating the new 8th Collective Agreement with the labor unions, since the previous one expires in a few months. A few hours ago, I received a letter from Germany giving me instructions to pursue the same labor costs as SEAT. I am deeply concerned, Patrick; I can't cut employee salaries any further. How can we reduce labor costs if we are more expensive? It's not possible!"