Volkswagen to hike wages for U.S. workers by 11%

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Volkswagen to hike wages for U.S. workers by 11%
Credit: © Reuters.

German automaker, Volkswagen (ETR: VOWG_p ) revealed Wednesday its decision to increase salaries for production workers at its Chattanooga assembly plant in Tennessee by 11%. This announcement comes weeks after the United Auto Workers union secured substantial pay and benefit raises from the Detroit Three automakers.

Volkswagen and other non-union automakers in the United States are facing escalating pressure to enhance pay and benefits, particularly in the wake of the landmark contracts secured by the UAW in late October following a six-week targeted strike involving thousands of its members.

Japanese automakers Honda Motor (NYSE: HMC ) and Toyota (NYSE: TM ) have recently raised wages for non-union factory workers in the U.S. This action coincides with signs that the union is shifting its focus toward organizing the labor force at foreign-owned auto plants, including those operated by Tesla (NASDAQ: TSLA ).

Hyundai Motor (OTC: HYMTF ) has also declared a planned wage hike of 25% over the next four years for non-union production workers based in Alabama and Georgia.

UAW President Shawn Fain recently mentioned that the union has been receiving signs of interest in unionizing from numerous Tesla (TSLA) workers.

The EV giant, led by Elon Musk, continues to hold an operating profit advantage over other automakers. However, Tesla has not made any public announcements regarding salary increases for its U.S. workforce.

Volkswagen's salary hike will take effect from December, with a condensed wage progression schedule starting in February.

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