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By Carmen Munari
SAO PAULO, Brazil (Reuters)
VW , which on Thursday said it planned to cut almost 20 percent of 16,000 staff
at the Anchieta factory in Sao Bernardo, said it could also ease back the number
of jobs it needs to trim during a downturn in Brazil's auto industry and as
more modern production comes on line.
"Reversing to zero won't work but neither will leaving them at 3,000," VW Brazil President Herbert Demel told reporters.
Talks between VW, Brazil's biggest car manufacturer, and the ABC Metalworkers' Union collapsed on Tuesday when workers rejected VW's proposal to trim work hours and wages by 15 percent to save 4,000 jobs.
By Thursday, workers were opening letters announcing the layoffs and responded by calling a strike at the Anchieta plant starting Monday. The ABC Union, which represents auto industry workers on the outskirts of Sao Paulo, is one of Brazil's largest and best-organised.
Union leaders sent Demel a letter on Friday saying they were ready to negotiate. Demel said lay offs were "a consummate fact" and that their suspension could not be a condition for the negotiations to take place.
Luiz Marinho, president of the ABC Union, appeared to agree.
"I can't say 'I only negotiate with Volkswagen if they reverse the layoffs.' Not even (Demel) can say he won't reverse anything," Marinho told reporters.
The two are expected to restart talks Saturday at 10:00 a.m. (1200 GMT).
Yet Demel feared the strike was inevitable and asked that workers keep their protest non-violent as rumours swirled they may take over the 50-year-old factory.
The layoff of 3,000 workers, if it takes place, would be one of the largest in recent history in Brazil and come as the car industry suffers from a general slowing of the economy and high interest rates which have quashed consumer confidence.
Demel said its Anchieta plant was also suffering from the higher costs of business in Sao Paulo state, Brazil's wealthiest and where the auto industry has traditionally been focused.
"In greater Sao Paulo, costs are a lot bigger and clients don't buy cars that are more expensive just because they're built in Sao Paulo," he said.
He said the average wage at the Sao Bernardo plant was 1,700 reais ($670) compared with 650 reais ($256) at its factory in the state of Parana. (Copyright © 2001 Reuters Limited)
German carmaker Volkswagen (VW) is to lay off 3,000 workers in Brazil, after it failed to agree cost-cutting measures with unions.
The jobs will go on Monday at its Anchieta factory near Sao Paolo, which employs 16,000 of VW's 28,000 workforce in Brazil.
"We have to look for alternatives in the short term to deal with a market that has great difficulties and resolve the company's structural problems," VW Brazil chairman Herbert Demel said in a letter to employees.
The company had been trying to negotiate a deal with the ABC metalworkers union to save jobs by reducing hours and pay.
On Tuesday talks between the two sides collapsed after workers rejected plans to cut pay and hours by 15%.
VW says the jobs cuts were needed because of falling demand and the introduction
of new technology.
"Overstaffing in the Brazilian plants was a result of slowing demand on the Brazilian market and the use of the most modern manufacturing technology for the new Polo which is about to be launched in Brazil," the company said.
Car sales in Brazil have dropped sharply since July due to a combination of high interest rates and currency weakness.
VW sales in October were 15% down on the same period last year, while production dropped 13%.
VW said is continuing talks with unions at its factory in Taubate to try and avoid another 1,000 job cuts. (©BBC News, Thursday, 8 November, 2001,)
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