Germany’s largest premium carmaker is freezing a special contractual payment worth nearly a fifth of monthly base pay for almost its entire domestic workforce, the latest sign of mounting cost pressure in the country’s automotive sector. About 90,000 employees covered by the company’s collective wage agreement will not receive the supplemental payment in July 2026 as originally scheduled; instead, the payout is now delayed until April 2027.
The move follows
Beyond the bonus freeze, the board is pressing for negotiations on lengthening the standard 35-hour working week without additional pay. The goal is to reduce personnel expenses and boost productivity at German plants, where labour costs are among the highest in the industry. Roughly 5,000 workers have already left the company under voluntary severance programmes, and internal discussions about shifting more production to lower-cost locations are ongoing.
The works council reacted sharply, calling the suspension of the bonus a “unilateral decision by the board”. The employee side argues that the company is under intense pressure but insists that any further concessions must be negotiated jointly with the IG Metall union, which has already been asked to participate in talks about working-time changes. Morale among the workforce is said to be strained.
At the Frankfurt stock exchange, Mercedes-Benz shares edged down 1.38 percent to around €44.10.
