Wage Dispute Halts Production at VW Plant

Workers at Volkswagen’s plant in Puebla, Mexico, walked out in a wage dispute, halting production at the world’s only factory producing the popular New Beetle. Salary talks with unions representing 12,600 workers collapsed after 10 days of negotiations. Although the two sides resumed talks later in the day, the walkout continued, a spokesman for the German car maker said. Unions are demanding a 35% wage increase, but the company is offering a raise closer to Mexican inflation, expected to be about 9% this year. The strike halted the plant’s daily production of 1,540 automobiles. VW is Mexico’s largest auto exporter, and the Puebla plant produced a record 410,000 vehicles in 1999, up from 339,000 in 1998.