Volkswagen de Mexico Reaches 2026-2028 Labor Agreement

Volkswagen de Mexico Reaches 2026-2028 Collective Bargaining Agreement

On August 26, Volkswagen de Mexico and the Independent Union of Workers of the Automotive Industry of Volkswagen de Mexico (SITIAVW) reached an agreement covering the 2026-2028 collective bargaining agreement, preventing a strike at the Puebla plant. The Volkswagen de Mexico labor agreement provides an overall 10.04% improvement in workers' compensation, including a 4.30% direct wage increase and a 5.74% increase in benefits. The agreement followed mediation by Mexico's Ministry of Labor and the Federal Center for Conciliation and Labor Registration.

Agreement Awaits Ratification by Unionized Employees

The collective bargaining agreement is not yet effective because it must be ratified by more than 7,000 unionized employees. The vote is scheduled for September 11 and will take place in accordance with Mexico's labor legislation. If approved, the agreement will establish the compensation improvements and other terms negotiated between Volkswagen de Mexico and SITIAVW for the 2026-2028 period. The settlement removes the immediate risk of a strike at the Puebla facility while the ratification process determines whether the negotiated agreement will formally take effect.

Volkswagen Indefinitely Suspends One Puebla Production Shift

Separately, on August 28, Volkswagen de Mexico announced the indefinite suspension of one of the three production shifts operating on the Jetta and Tiguan lines at its Puebla plant. The measure could affect 786 contracts. The company announced the production change two days after reaching the collective bargaining agreement, creating a separate workforce development at the facility. The suspension applies to one production shift, while the Jetta and Tiguan lines remain identified as the affected production operations at the Puebla plant.

SITIAVW Rejects Link Between Shift Reduction and Negotiations

In response to the workforce reduction, SITIAVW denied that the suspension of the production shift was connected to the collective bargaining negotiations. The union also urged affected employees not to sign any voluntary resignation or termination documents from VW Mexico. The position separates the production-shift decision from the recently negotiated labor agreement and highlights the distinction between the compensation settlement and the subsequent workforce action. The agreement still requires the September 11 employee vote before it can become effective under Mexico's labor legislation.

Frequently Asked Questions

What did Volkswagen de Mexico and SITIAVW agree on?
The agreement covers the 2026-2028 collective bargaining period and provides a 10.04% overall improvement in workers' compensation, including a 4.30% direct wage increase and a 5.74% increase in benefits. The settlement was reached after mediation involving Mexico's Ministry of Labor and the Federal Center for Conciliation and Labor Registration. More than 7,000 unionized employees must still ratify the agreement through a vote scheduled for September 11. Separately, Volkswagen de Mexico indefinitely suspended one production shift affecting the Jetta and Tiguan lines at its Puebla plant.