A scandal has erupted in Germany following the appearance of Audi’s CEO, Gernot Delner, at a campaign rally for US President Donald Trump. During the event on 24 October in the state of Georgia, the head of the German car manufacturer announced plans to invest around $4 billion in the construction of a factory in the US. Trade union representatives and politicians accused him of breaching the principle of political neutrality, particularly against the backdrop of large-scale job cuts at Volkswagen in Germany.
- Audi CEO Gernot Delner appeared alongside Donald Trump at an election rally in Georgia.
- The company has announced plans to invest around $4 billion in its first car factory in the US.
- The company plans to create 4,500 jobs and produce up to 200,000 cars each year.
- German trade unions have accused the head of Audi of breaching the principle of political neutrality.
Why did the Audi CEO’s speech cause a scandal?
Gernot Delner took to the stage alongside Donald Trump during a campaign event in Perry, near Macon. There were ten days to go until the US mid-term elections, scheduled for 3 November.
The appearance of the head of one of Germany’s largest car manufacturers at a political rally sparked a strong reaction within the Volkswagen Group, of which Audi is a part.
Chairman of the Works Council of the Volkswagen Group Daniela Cavallo She accused the company’s management of taking part in a pre-election political event. She criticised Trump’s speech, describing it as rife with racism, sexism and contempt for democracy.
According to Cavallo, Delner’s involvement turned the automotive group’s representative into part of the US President’s political spectacle.
Christiane Benner, head of the influential German trade union IG Metall, also condemned the speech. She stated that the Audi chief had breached corporate rules requiring political neutrality in the run-up to the election.
German politicians also backed the criticism. The Prime Minister of Lower Saxony Olaf Lis stressed that an election rally is not the appropriate venue for announcing investments on such a scale.
Audi plans to build a factory in the US at a cost of $4 billion
The new car factory is planned to be built near the city of Macon in the state of Georgia. For Audi, this will be its first own production facility in the United States.
According to preliminary plans, construction is set to begin in 2027, with mass production due to start in the early 2030s.
The plant will specialise in large, premium off-road vehicles. The planned production capacity is around 200,000 vehicles per year. The company expects to create approximately 4,500 jobs.
One of the reasons for the expansion of production in the US was the American import duties. It is estimated that these cost Audi around 1.2 billion euros last year.
However, the final decision on the investment still requires the approval of Volkswagen’s supervisory board, which includes employee representatives.
How Audi explained its participation in the Trump rally
Following the criticism, the company stated that its delegation had been in Georgia for talks regarding the future plant. As part of these meetings, Audi’s management was invited to present its investment plans alongside the US President.
Delner explained that he had accepted the invitation in the company’s interests. At the same time, Audi acknowledged that the format of the event could have been perceived as political support for Trump, and stated that it took such a reaction seriously.
According to Reuters, Audi’s board has provisionally approved an exemption from the corporate rules to allow the executive to attend the event. Consequently, the trade unions’ claims of a breach of the code of conduct remain a matter of dispute.
The car manufacturer itself emphasises that the principle of political neutrality remains important to the company.
Why is this important for Volkswagen?
The announcement of multi-billion investments in US manufacturing coincided with a large-scale the restructuring of Volkswagen in Germany.
The group plans to cut jobs and production capacity due to increased competition from Chinese car manufacturers, high costs and trade barriers.
According to Reuters, the restructuring may involve reduction around 100,000 jobs. Among the companies whose future is under discussion is the Audi plant in Neckarsulm, which employs around 15,000 people.
Against this backdrop, the decision to announce the creation of thousands of jobs in the US during a political rally provoked particular discontent amongst German trade unions.
At the same time, analysts recognise the economic benefits of localising Audi’s production in the US market. Manufacturing cars directly in the US would enable the company to reduce its dependence on import duties.
