BERLIN -- Volkswagen Group's talks with unions over the implementation of its turnaround plan were broken off on Monday, leaving in limbo a deal on cost-cutting following the automaker's damaging diesel emissions scandal.
Labor bosses halted cooperation with management on issues including overtime work, efficiency gains and apprenticeships last week, saying executives were trying to squeeze greater savings than agreed in November.
On Monday VW's works council indicated that tensions between its head Bernd Osterloh and VW brand chief Herbert Diess, who have clashed over how to achieve greater savings, had not eased and called for VW Group CEO Matthias Mueller to play a greater role in resolving the dispute.
Unions say Diess, who established a reputation for cutting costs at BMW, wants to cut temporary workers more quickly and deeply than agreed.
VW has said it cannot keep a large number of temporary staff on its books because of shrinking demand for models such as the Golf hatchback and Passat sedan.
"We would welcome if the group's management would more strongly deal with the implementation of the future pact and the compliance with agreements," a works council spokesman said in an emailed statement.
A VW brand spokesman confirmed that talks have been postponed, but declined further comment.
Mueller, in a letter to staff on Monday which was seen by Reuters, indicated he may get more directly involved. "We as group management and I personally will continue to do everything, so that conflicts are resolved in a constructive manner and VW will be protected from harm," he said.
The so-called future pact will lead to 3.7 billion euros ($3.9 billion) in annual savings by 2020 and foresees 30,000 job cuts at the VW brand without forcing layoffs until 2025.
This plan is seen by analysts as critical to raising profitability at VW's core division, which is lagging rivals including Renault, PSA and Toyota. Apart from VW, Volkswagen Group also owns the Audi, Skoda, SEAT, and Porsche marques.
VW is having to make cuts to its high-cost operations in Germany to fund a strategic shift and shed costs following the diesel emissions affair, which is costing it billions of dollars in settlements.