Following a union sponsored ballot, Mexican workers for Volkswagen AG rejected the latest offer on pay and working hours.
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The company began negotiations last Friday with Union leaders at VW#;s only Mexican plant to reduce working hours by up to 12 percent and to decrease pay for the 11,450 workers by a commensurate amount to about $28 per day.
A 3-to-1 majority rejected the plan despite Unions recommending acceptance. VW claimed the move was necessary to safeguard some 1,350 jobs that would otherwise be jeopardised in 2002/2003 following a slump in demand from the USA; an important market for Mexico#;s car industry as it historically bought close to 80% of all car exports.
The company say they will now start implementing personnel cuts. Some 380 temporary, or contract, workers may not have their contracts renewed at the VW plant when they expire on March 23 with a further 900 or more to leave during 2003. These reductions follow some 1,200 seasonal workers not re-employed after 2001 contracts expired.
