Mercedes-Benz warns it may close German factories over costs

Mercedes-Benz is considering closing factories in Germany and could halt further investment in its home country as it presses workers and unions to accept lower costs amid falling sales and profits.

The warning came in an internal message to staff, reported by AFP and dpa and relayed by Nieuws.nl. Michael Schiebe, a member of the company’s management board, said Mercedes was “forced” to examine “which German factories we must close if we fail to adjust our cost structure”. He added that new models would then be built abroad.

The dispute pits Mercedes against trade union IG Metall and the company’s works council over wages and cost-cutting. IG Metall has called for a 5 per cent pay rise, which Mercedes has described as “excessive”.

Another management board member, Britta Seeger, has argued that the company needs to become more productive. The 35-hour working week is also under discussion.

The reported factory closures are a possibility raised by Schiebe, not an announced decision. The company’s warning puts jobs, investment and future vehicle production in Germany at the centre of the talks.