German metalworkers union IG Metall considers Volkswagen's plans to cut labour costs by roughly €2 billion ($US2.5 billion) by 2011 nearly impossible to achieve, Stuttgarter Zeitung reported on Tuesday.

"That's completely unrealistic," said Hartmut Meine, IG Metall's regional head who is leading talks with the carmaker, in an interview with the newspaper cited by Reuters.

Meine reportedly will begin talks on Wednesday with VW over a new in-house wage agreement for the 103,000 workers at the carmaker's six western German plants. VW's demand for a two year pay-freeze is an key plank of the cost cutting plan. Meanwhile, the union is calling for a 4% raise and job guarantees for the next 10 years.

Meine reportedly added that it wasn't enough for Volkswagen to agree on the guarantees, though.

"A piece of paper with the number 103,000 and two signatures is too weak," he said, according to Reuters. "They have to specify what kind of investments will be made in the mid to long-term for each of the six plants."

Meine reiterated earlier statements that he was not currently considering reaching for the strong medicine to push through his demands.

"You only start to think about a strike if after the fourth or fifth round of talks it's not even remotely clear where a compromise could be found," he reportedly said.

Meine said over the weekend that he would first consider strikes after "three or four rounds" of unsuccessful talks, Reuters noted.