Volkswagen Group has equipped more than 330,000 employees with Microsoft Copilot, expanding its use of artificial intelligence across the automotive business as the company faces reports of a proposed salary freeze affecting around 660,000 employees worldwide until 2030.
Microsoft announced the AI deployment on Wednesday, describing it as part of Volkswagen’s phased approach to workplace AI adoption. The separate salary freeze proposal was reported by Reuters, citing the company’s Global Works Council, but Volkswagen has not confirmed the plan.
The two developments highlight different aspects of the German automotive group’s current position: expanding digital tools across its workforce while management and employee representatives face discussions over labour costs.
AI adoption moves beyond workplace chat
Volkswagen began its Copilot rollout by providing employees with access to Copilot Chat, Microsoft’s AI-powered chat service. According to Microsoft, the platform recorded more than 300,000 monthly active users at Volkswagen.
The company has since expanded its use of Copilot with Work IQ, which supports more advanced productivity scenarios and integrates AI into business processes.
Microsoft said employees are using the tools across functions including engineering, production, procurement and sales. More than 26,000 AI agents were also active across Volkswagen Group during the month preceding the announcement.
Volkswagen’s Head of Group Data and AI, Sophie Vassarotti, said the aim was to make secure AI support available at scale and help employees work more efficiently and make better-informed decisions.
Agnes Heftberger, chair of the management board of Microsoft Germany, said the deployment brings AI into employees’ everyday work and could help them focus on higher-value tasks.
Microsoft and Volkswagen plan to expand data collaboration
Alongside the Copilot deployment, the companies intend to expand their collaboration around Volkswagen’s Intelligent Data Foundation, a unified data ecosystem designed to make trusted information easier to find, understand and use.
Microsoft said the companies plan to scale the platform further using Microsoft Fabric, its data analytics platform.
The collaboration is scheduled to feature at the Microsoft Frontier Tour in Cologne, Germany, on 22 October 2026. Vassarotti and Rupert Stuetzle, Microsoft’s general manager for manufacturing and mobility in Europe, the Middle East and Africa, are due to present Volkswagen’s approach to group-wide AI adoption.
Microsoft has not disclosed the financial terms of the collaboration or quantified any productivity gains resulting from the rollout.
Reported salary freeze could run until 2030
Separately, Reuters reported that Volkswagen plans to freeze salaries for approximately 660,000 employees worldwide until 2030, citing information from the company’s Global Works Council. German newspaper Süddeutsche Zeitung first reported the proposal, citing internal documents.
Volkswagen has not officially confirmed the reported plan. According to Reuters, a company spokesperson described the reports as speculation and said upcoming discussions would address proposals concerning labour costs.
The reported measures could extend beyond fixed salaries. Süddeutsche Zeitung said proposed management guidelines would also cover variable pay, special payments, employee benefits and jobs.
Key details in the reporting include:
Proposed duration: The salary freeze could remain in place until 2030.
Potential workforce covered: Around 660,000 employees worldwide.
Possible effect on purchasing power: Süddeutsche Zeitung estimated that the absence of pay rises could reduce employees’ income by around 10% through inflation. This refers to purchasing power, not a confirmed nominal salary cut.
Wider cost measures: Reported proposals include changes to variable pay, special payments, benefits and jobs.
Current status: The salary freeze remains an unconfirmed proposal, with labour-cost discussions expected to determine the next steps.
Employee representatives signal opposition
The reported salary freeze has drawn resistance from employee representatives. Volkswagen’s Global Works Council criticised the approach, while German trade union IG Metall stressed that pay decisions should be reached through collective negotiations.
An IG Metall spokesperson told Reuters: “At Volkswagen, pay development is decided at the negotiating table, not by decree from the executive boardroom.”
The proposed freeze comes amid a broader restructuring effort led by Volkswagen chief executive Oliver Blume. However, available reporting does not establish whether the salary proposal has been formally approved or agreed with employee representatives.
Negotiations will shape the next phase
Volkswagen’s Copilot deployment marks a substantial expansion of AI access across its workforce, although Microsoft has not provided independently measured productivity results.
Meanwhile, the salary freeze proposal remains subject to clarification and labour-cost discussions. The eventual outcome will depend on negotiations between Volkswagen’s management and employee representatives, while the company’s wider use of AI continues to develop across its operations.
