Published by Global Banking & Finance Review®
Posted on March 13, 2025
2 min readLast updated: January 24, 2026
Add as preferred source on GoogleVolkswagen cuts production in Tennessee amid UAW labor charges, citing reduced EV demand. The Chattanooga plant faces union negotiations.
By Nora Eckert
DETROIT (Reuters) -The United Auto Workers union said on Thursday it filed unfair labor practice charges against Volkswagen, as the automaker cut jobs at a factory in Tennessee where the union is negotiating its first contract after winning an election there last year.
"The UAW has notified the Trump Administration of Volkswagen’s unacceptable, anti-union, anti-worker, and anti-American conduct," UAW President Shawn Fain said in a statement.
A spokesperson for Volkswagen said it is cutting production in Tennessee to a two-shift model out of caution for lowered electric vehicle demand. Workers at the Tennessee plant assemble the ID.4 electric SUV.
The Germany-based automaker is offering production employees a "voluntary attrition program," including a severance package, retirement options and benefits, the spokesperson said.
"We remain committed to our team members, our customers, and our presence in Chattanooga. This change supports that commitment," the company said in a statement.
The auto union won an election at the Chattanooga, Tennessee factory in April, making it the first auto plant in the South to unionize via election since the 1940s, and the first foreign-owned auto plant in the South to do so. Since the election, the union and company have been negotiating the first labor contract there.
Volkswagen has been cutting jobs globally as it confronts weakening demand and intensifying competition from Chinese automakers.
Late last year, the car company announced plans to slash more than 35,000 jobs after a bitter battle with unions in Europe.
In the U.S., President Donald Trump's 25% tariffs on imports from Mexico and Canada pose a more imminent threat. Trump has allowed vehicles that comply with the United States-Mexico-Canada Agreement rules of origin to avoid these added duties until early April.
Volkswagen said last week its North American vehicles are made in compliance with the USMCA.
Among German carmakers, the Volkswagen Group is the most exposed to Trump's tariff threats on Mexico and Canada. Its Audi and Porsche brands have no U.S. manufacturing base, its VW passenger car brand's U.S. sales consist mainly of imports from its Mexican plant, and its battery cell plant under construction in Canada was set to deliver batteries to the United States.
(Reporting by Nora Eckert, Editing by Franklin Paul and Chris Reese)
The article discusses Volkswagen's production cuts in Tennessee and the UAW's unfair labor practice charges against the company.
Volkswagen is reducing production due to lowered demand for electric vehicles.
The UAW has filed unfair labor practice charges against Volkswagen.
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