Supply Chain Matters continues to highlight various indications of increased labor activism involving major manufacturers or supply chain services providers.
While some industry observers can view EV automaker Tesla as having an existing labor cost advantage in shunning organized labor across its factories, or in the automation of such factories, one report would indicate a brewing challenge.
Labor Activism at Tesla’s Berlin Facility
This week, a published report from Bloomberg indicates that production workers at the EV automaker’s recently opened Berlin complex “are growing increasingly concerned about safety hazards and overwork, according to IG Metall, prompting more workers to join the German union.”
The Bloomberg report indicates that more than 1,000 workers or upwards of 12,000 workers at Tesla’s production facility in Grenheide reported to work yesterday wearing stickers calling for “safe and fair work.” The labor union points to Tesla workers “complaining about poor conditions and safety hazards, including extreme workloads due to staff shortages and overly ambitious production targets.” Consequently, the IG Metall labor union has reportedly seen a spike in the number of workers seeking to join its ranks.
While some of our readers may elect to not place emphasis on the timing of such a report, given the current targeted labor contract disruptions occurring among the three U.S, automakers that include a theme of worker concerns related to the industry’s ongoing transformation to EV and hybrid powered vehicles, we would advise otherwise.
Those that are familiar with Germany’s labor policies know that labor representation is matter national practice that includes organized labor having a voice within any German company’s executive level Supervisory Board. This influence includes the country’s very influential auto industry, including Volkswagen, Germany’s largest auto maker, who’s production workers are represented by IG Metall. The Bloomberg report indicates that thus far, Tesla has refused to sign a wage agreement that is standard for German industry, which includes representation for labor policy matters. Yet, this auto maker is indeed under the gun to ramp-up its European based production and delivery capabilities to thwart the ambitions of other traditional auto makers now having EV focused supply and production networks as part of their market growth strategies for the European market segment.
The further dynamic underway specifically regarding Tesla is that the German government actively encouraged, by means of monetary and other incentives. Tesla’s decision to source its major European EV manufacturing presence within this country.
From our lens, Tesla has to thread carefully in its ramp-up plans for the Berlin facility. In the absence of worker concerns having a voice at the operating management level, such activism will continue to be a challenge for both the EV automaker and for German government officials who encouraged its presence.
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