Growing congestion at ports in Germany and the Netherlands, which could delay shipments of cars and furniture to the US for weeks, shows no sign of easing as the latest round of labor talks between the Central Association of German Seaport Companies (ZDS) and ver.di, the German labor union, ended without agreement. One key sticking point is the link between harbor workers’ wages and inflation.
Germany, Europe’s largest economy, is facing soaring inflation, with food and energy inflation worsening in the aftermath of Russia’s war with Ukraine. This inflation is at the heart of the deadlock in negotiations. The union is calling for an automatic annual inflation adjustment to be built into a new collective agreement for their workers at 58 ports and terminals. ZDS said its offer was above the inflation rate, but the union rejected the offer.
The head of ver.di’s maritime division, Maya Schwiegershausen-Güth, said in a statement to the press: “Increasing prices for essential living costs such as energy and food have become unsustainable burden on German workers, especially on lower-paid workers. . She added that employers, represented by the Central Association of German Seaport Companies (ZDS), have so far rejected the principle of inflation protection in negotiations with the union.
“These port companies plan to leave their employees alone to deal with the consequences of rising prices. They are willing to see the wages of harbor workers set back, eroded by We can’t accept this, especially after all that harbor workers have done for employers and the common good,” she said.
On the ZDS website, ZDS negotiator Ulrike Riedel states, “We have repeatedly improved our offers and met the requirements of ver.di. There is no willingness to compromise from ver.di. There is currently an offer of up to 12.5% This also includes a permanent salary increase of up to 8% from January 6. With this offer we are on very high inflation rates and much higher than what ver.di and other unions are asking for and end up in other current negotiations.”
Throughout June during the negotiations, unions warned of strikes over change and 24-hour strikes that have halted trade flows at several German ports. This slowdown create a congested spread to ports in the Netherlands loaded with containers destined for the United States and countries around the world.
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According to Germany’s trade office, motor vehicles and auto parts are the country’s top exports (15.4%). Ranked second and third: Machinery (14.2%) and chemical products (10.0%).
In addition to those major exports, Ikea furniture and other household goods are also shipped out of those ports. Other products include lithium batteries for cars and chassis. Mercedes, BMW carand Ford are also listed in the Recent Bill of Lading.
Andreas Braun, Crane Worldwide Logistics’ Europe, Middle East and Africa product manager, recently told CNBC, “U.S. importers need to look four to five weeks in advance to see vessel availability. Or not. This is not normal. Also, if you are lucky enough to get a seat on a ship then you have to locate an empty container possibly inland (Germany or the Netherlands).”
Sources told CNBC no strikes have been announced or expected this week but there are concerns that future strikes could be announced. There have been no announcements of new negotiations.
Negotiator ZDS said of their final offer to the alliance, “We can’t pay more than that without jeopardizing the existence of the companies. A further escalation is completely out of the question. This offer is disproportionate and harmful not only to us but also to Germany. We urgently need a conciliation proceeding.”
If the deadlock continues, the referee may be called. This is a common dispute resolution procedure in Germany. If that happens, strikes will be ruled out.
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