German transmission supplier GETRAG is talking with unions about restructuring.

Negotiations should be over by the end of January, Autombilwoche reported, but no solution is yet in sight. A union representative said employees should not have to pay for risky oversesas expansion and management mistakes. The union is resisting job and pay cuts.

Getrag is family-owned and based in Heilbronn. Head Dieter Schlenkermann wants to cut 380 jobs and close one of four plants in Germany. He said: “Getrag is massively affected by the crisis in the vehicle market, like other automotive suppliers. We must assume that we have long-term overcapacity.”

Getrag was hit by the cancellation last October of a Chrysler contract to supply 700,000 gearboxes a year. Lawsuits are pending but the US facility that was being built specifically to make the Chrysler transmissions has had to file for Chapter 11 bankruptcy protection.

Last June Getrag Group and GETRAG FORD Transmissions said they would spend $500m on a joint venture called Getrag Transmission Manufacturing de México and build a new plant in Irapuato, in the state of Guanajuato. That will produce around 350,000 transmissions a year from late 2009 or early 2010.

In Germany Getrag is looking to save EUR27m a year by 2010. According to unions, the company is hoping to reduce working hours, without adjusting wages, but it wants to delay an already-agreed wage increase by six months. The supplier is expecting sales to fall by 20% to 25% in the next year.

Getrag Tipton files Ch 11