Volkswagen workers ended a weeklong strike at the company's largest and oldest Brazilian factory on Monday after the company suspended a plan to lay off about 1,800 production employees, union leaders said.
VW employees had launched the work stoppage on Aug. 29 after they started receiving pink slips as part of the German automaker's plan to restructure its Brazil operations.
VW said in a statement that it would restart stalled talks on the restructuring at the Sao Bernardo do Campo factory and that it had set a Sept. 15 deadline for reaching a deal with the union.
However, the union and company haven't yet scheduled any talks, the statement said.
Volkswagen said it needs a deal with workers in order for the plant to be eligible for new investments. Without new investments geared at new models, the factory will need to be closed, VW said.
Volkswagen has said high labor costs make the plant unprofitable. The factory employs some 12,000 workers, 9,000 of whom work on production lines that turn out about 900 cars daily.
The automaker announced in May that it would restructure to lower production for export mar-kets and cut labor costs to increase profitability. VW had said it planned to cut as many as 6,000 jobs in the South American country through 2008.
The union's president, Jose Lopes Feijoo, warned on Monday that VW workers will resist any move that involves layoffs.
"Don't mess with us," he said, according to the Agencia Estado news agency. "We know how to fight."
The strike's end and the suspension of layoffs came after Brazilian President Luis Inacio Lula da Silva criticized the company twice last week, saying VW created its own problems in Latin America's largest country and should find ways to hire workers instead of firing them.
Silva -- now in the midst of a re-election campaign -- rose to fame in the late 1970s and early 1980s as the leader of the metalworkers union representing VW employees at the plant, in Sao Paulo's industrial suburb of Sao Bernardo do Campo.
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