The head of Volkswagen ‘s 10,000-member Mexican union said on Thursday that he’s working against time to reach an agreement with the company to save over 2,000 jobs, Dow Jones reported.
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“We hope to have an understanding by early next week, or else we might have to appeal to the president of Mexico,” union leader Jose Luis Rodriguez reportedly said at a Volkswagen event.
Dow Jones noted that Volkswagen’s Mexico plant, the sole producer of the New Beetle and one of the biggest employers in the Mexican car industry, has cut about 2,500 jobs since 2000 and, added that, in June, the company said its Mexico facility would reduce production by 23% starting next month due to lower demand for its New Beetle and Jetta [Bora] models in export markets, putting around 2,000 more staff out of work.
Citing data from Mexican vehicle association AMIA, Dow Jones said Volkswagen has already lowered production at the plant this year by 16% and noted that close to 80% of the vehicles Volkswagen assembles in Puebla are for export.
The company shipped 121,731 vehicles from Mexico during the first half of the year, or 11% less than in the same 2002 period, the report added.
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By GlobalDataAccording to Dow Jones, Volkswagen’s Mexican union suggested last Friday that workers take a shortened, four-day work week to adjust production, but Rodriguez said that the union disagrees with company officials over how to reflect the cut-back in salaries.
Meanwhile, Dow Jones said, the Puebla plant will decommission the original Beetle assembly line, the last in the world, at the end of July, displacing another 350 workers, though activity is expected to pick up again at the facility in 2005, when the plant assumes exclusive production of the [redesigned] Jetta/Bora models.
“We will do everything necessary to keep being a competitive and quality production plant in order to be taken into account in decisions for future projects,” the head of Volkswagen Mexico, Reinhard Jung, said, according to Dow Jones.
The news agency noted that, apart from its own employees, nearly 50,000 workers in Mexico’s automotive parts industry depend directly on Volkswagen, the country’s third-biggest car manufacturer, which has invested over $US3.6 billion in its operations since arriving there in 1954.
