Volkswagen’s Mexican Workers Offer Pay Cuts

Union workers at Mexico’s Volkswagen plant have agreed to negotiate salary cuts to avoid the layoffs of 2,000 employees, a union spokesman said Friday.

Labor leaders will propose shrinking the workweek to four days from five and cutting salaries 20%, spokesman Miguel Galan said.

Talks are scheduled to begin Monday.

Volkswagen announced this week that daily production would be cut by 23% as of August, leading to the possible layoffs of 2,000 workers. The company blamed sluggish sales of the Jetta and New Beetle models in foreign markets, mainly the United States.

Volkswagen also recently announced that it was ending production of the Sedan -- the old Beetle -- at the Mexican plant, the only place where it has been produced since 1978.

Volkswagen exported 103,379 vehicles from Mexico during the first five months of the year, or nearly 13% fewer than in the same period of 2002.

Volkswagen spokesman Luis Miguel Briones said the company was waiting for a formal proposal from the union before it made a public response.

Galan said the proposal from the union, which represents 10,000 workers, would ask for salary cuts for the plant’s approximately 3,500 nonunion and top-level employees.