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MEXICO: VW and union agree pay deal ahead of strike deadline

By just-auto.com editorial team | 19 August 2005

Volkswagen Mexican unit has reached an agreement with union leaders to increase workers' pay and avoid a strike, according to Reuters.

More than 11,000 union workers at Volkswagen's plant near the city of Puebla accepted a 4.2% pay raise, preventing a walkout scheduled for Thursday, union leader Jose Luis Rodriguez told the news agency.

The Puebla plant is the only Volkswagen manufacturing operation in North America and is the sole producer of the popular New Beetle, the report noted.

The new salary deal includes minor improvements in benefits, the company and union reportedly said. Workers had originally demanded a 12.5% raise but lowered it to 10% in recent days.

"With this agreement, we're above average in the (Mexican) automotive industry," Rodriguez told Reuters.