Enterprise bargaining negotiations between Australian General Motors affiliate Holden and car workers' unions ended in deadlock today, opening up the threat of a second strike within a month, writes Mike Duffy.

Two days of talks between 40 union officials and shop stewards and company negotiators broke up without reaching agreement.

Holden chairman and managing director Peter Hanenberger and his board are said to be furious because union negotiators allowed shop stewards to introduce fresh demands late in final negotiations. One of the claims introduced today sought shift penalty payments for sick leave.

The car maker is believed to have spent more than $100,000 flying in and accommodating union officials and shop stewards from the car assembly plant at Adelaide in top Melbourne hotels close to Holden HQ.

After talks ended without resolution, the company is understood to have issued an ultimatum to auto unions to sign off on a raft of workplace conditions. Union officials and shop stewards are to return to Melbourne on Tuesday to continue negotiations - at further cost to Holden.

Ironically, Mr Hanenberger will be in Adelaide that day, releasing the Series II VX Commodore, WH Statesman and VU Utility - the best selling large car range in Australia and the basis of the breadwinning Chevrolet-badged export cars to the Middle East.

The vehicle builders division of the Australian Manufacturing Workers Union is the lead negotiator in talks designed to reach a new three-year enterprise bargaining agreement.

The union refused to disclose their position and a spokesman for Holden said negotiations "were continuing".

Negotiations are yet to cover pay increases during the life of the agreement. The union is seeking wage increases totaling 24 percent while Ford and Mitsubishi Motors have signed off on 15.25 percent increases as part of their house agreements. Toyota Australia, which has a poor industrial relations record for a greenfield site, will be anxiously looking on as its EBA comes up for renewal in 2002.

Holden lost production of 5,150 cars worth $A170 million two weeks ago when Sydney-based steering column manufacturer Tristar went on strike, bringing assembly at three of Australia four car makers to a halt for as much as nine days.

An observer close to the negotiations said: "Holden can't afford to lose any more production if it wants to meet its 2001 targets on the domestic and export markets.

"The company is looking to increase the number of shifts to catch up what has been lost but it can't afford to be hijacked by the unions.

"Unless the unions stop introducing additional demands and get serious about settling this agreement, the company could be prepared to take them on."

Holden has already delayed the introduction of a night shift at its sole production plant at Elizabeth, Adelaide - crucial to reach a production target of 180,000 cars by 2005 - until the workplace agreement is in place. The night shift would create several hundred new jobs.

There has been widespread speculation that parent company General Motors could rescind its decision to build a $A700 million V6 engine plant in Melbourne and move it to Brazil because of continued industrial unrest.

Mr Hanenberger said only last week in leading finance magazine Business Review Weekly that deteriorating industrial relations could be the Australian car industry's "Achilles heel".