Palmela, Portugal, July 29, 2026 (Lusa) - VW's Autoeuropa car factory in Portugal is currently undergoing refurbishment of its assembly line and paint shop, and will not resume production until 24 August, an official company source told Lusa on Wednesday.
«There was a holiday shutdown from 1 to 11 June, followed by another shutdown from 14 to 21 July due to a temporary layoff, as well as a second holiday period from 25 July to 16 August. A further one-week stoppage is also planned, under the lay-off scheme, from 17 to 23 August,» said the Autoeuropa spokesperson.
«The use of lay-offs [temporary suspension of employment contracts at the initiative of companies] is justified because the production halt was essential to enable the factory's expansion and modernisation. Furthermore, during lay-off periods, workers are paid 100% of their wages, as provided for in the collective agreement signed last February,» he added.
According to the company, the refurbishment currently underway at the Palmela plant aims, amongst other objectives, to prepare this Volkswagen Group facility for the production of the new ID.Every1 electric model, which is not expected to begin until the end of 2027.
Until production of the new electric model begins, Autoeuropa is expected to continue producing only the T-Roc, which has been one of the Volkswagen Group's best-selling cars.
At the start of the year, Volkswagen Autoeuropa workers approved a collective agreement valid until June 2027, which provides for pay rises of at least €100 and enhanced social benefits.
The agreement secured pay rises of 2.8% from February and a further 2.5% in October this year, both with a guaranteed minimum of €50.
Among other benefits, the agreement also guaranteed an increase in performance bonuses for 2026 and 2027, attendance bonuses and the guarantee of paid lay-offs at 100% of salary and shift allowance – a benefit that Autoeuropa workers are now enjoying.
When the new collective agreement was approved on 9 February this year, the leader of the Autoeuropa Workers' Committee, Rogério Nogueira, described it as «an agreement of great importance to workers given the instability of the automotive sector».
GR/AYLS // AYLS
Lusa
