CNM Internacional Confederação Nacional dos Metalúrgicos da CUT ( Brasil)

August, 20 2001

Mexico Volkswagen strike continues

MEXICO CITY - Management officials at Mexico's Volkswagen production plant refused to restart stalled salary negotiations with striking workers Sunday after national labor union representatives tried to intervene, the government news agency reported.
The Independent Union of Volkswagen Workers accepted an offer from the company to attempt talks again on Monday at the Labor Secretariat in Mexico City, where Sunday's talks were scheduled.
Repeated calls to representatives of the company went unreturned Sunday.
Adding fuel to the conflict, Volkswagen officials asked Mexican judicial and labor authorities on Sunday to declare the three-day old strike illegal, claiming it is politically motivated because of the substantial wage increase workers are demanding.
Employees are striking for a 21 percent wage increase above their current daily average of 272 pesos (US$25) per day.
Strikes in Mexico are reviewed by the nation's labor courts to determine if procedures were followed in declaring the strike.
Last year, three days after Volkswagen employees took to the picket lines, a Mexican court declared the strike illegal and forced strikers to return to work.
More than 12,000 of 16,000 workers went on strike Saturday at the factory in the central state of Puebla (78 miles east of Mexico City), the only Volkswagen plant in the world that manufactures both the new and old Beetles.
Jose Luis Rodriguez, secretary-general of the Volkswagen labor union, told Notimex the company has not made any feasible salary offers and that the union would negotiate only if the company proposes a minimum wage increase of 10 percent. The company has proposed a 5.5 percent increase as a starting point for negotiations.
Volkswagen vice president Francisco Bada was quoted by Notimex as denying the company had refused to negotiate in the presence of members of the National Workers Union.
He did not elaborate on what prevented the talks from proceeding, however, and said the company would explain later on what grounds it had requested the federal government to nullify the strike.
The strike at the assembly plant in Puebla is costing the German manufacturer 22 million dollars per day as the idled plant normally produces 1,500 vehicles, 2,000 engines and 1,000 axle assemblies daily. (TheNewsMexico.com - 8/20/2001)

VW may produce in the US

Volkswagen, the German car maker whose Mexican factory is in the grip of a strike, is considering building a new factory in North America, according to chairman Ferdinand Piech
If the dollar weakens in the long term, we would need another factory in the NAFTA area," Mr Piech said in the interview due to be published in the Financial Times Deutschland's Monday edition.
NAFTA is the North American Free Trade Area which comprises the United States, Mexico and Canada.
VW would also consider using spare capacity in South America to make cars for the US market, rather than continue making them in Europe, Mr Piech said.
Last week, the euro rose above $0.90 for the first time in many months and some analysts say the currency is set to appreciate against the US dollar.

Strike

Mr Piech's comments were published soon after more than 12,000 workers at the big Volkswagen plant in the Mexican city of Puebla went on strike over a pay dispute.
Production at the Mexican plant, the only one in the world which produces the new Volkswagen Beetle, came to a standstill on Saturday.
More than 80% of the vehicles made there are exported to the US, Europe and Asia.
In addition to the Beetle, the factory turns out Jettas and Golf convertibles.

Pay demand

The workers had initially demanded a pay rise of 30%, but reduced this to 21%.
The company rejected the demand, saying it was impossible to meet, especially with the sharp slow-down of the Mexican economy.
A senior VW executive said the company was willing to increase wages, but not at the rate demanded.
"We are negotiating the salaries, but 21% is impossible," said administrative board vice president Franciso Bada Sanz.
However, the main workers' union said that the company had not offered any increase.
"We didn't want a strike. We want a solution as soon as possible," said Jose Luis Rodriguez Salazar, secretary-general of the Independent Union of Volkswagen Workers.
Talks between the company and the trade union collapsed last Thursday.

Rejection

On Friday, the workers voted to reject a Mexican Labour Department proposal for a 5.5% rise.
Chairman Ferdinand Piech. The talks resumed over the weekend, but by late Sunday no resolution appeared to have been made.
The strike is the second in two years at the factory, which employs about 16,000 people.
Last year, a five-day strike ended when the Mexican government ordered the workers back to work. Soon after, they were granted a 13% rise.

Profits

VW is a hugely profitable car maker.
Last year, the company recorded net profits of more than 4bn euros ($3.7bn).
This year, the profits are expected to be greater, Mr Piech reiterated, despite falling sales in its home market Germany.
Exports to Asia and already introduced cost cutting measures will boost profits, the company said last month. (BBC News, 19 August, 2001).

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