Strike ends at Brazil VW factory

Workers will return to work after VW suspended plans to cut jobs

A union representing car workers at Volkswagen's largest factory in Brazil has called off a strike after VW agreed to suspend plans for job cuts.

The company said it was ready to negotiate to find a solution that would ensure the future for the Sao Bernardo do Campo plant in Sao Paulo.

The union indicated that the workers were ready to work extra hours.

The union called the strike after VW announced 1,800 layoffs as part of a plan to cut about 6,000 jobs in Brazil.

About 12,000 people are employed by VW at the plant, also known as Anchieta, which makes 960 vehicles a day including the Fox and the iconic VW Kombi.

The German firm employs 21,000 people in Brazil overall at five plants.

In a statement, Volkswagen said it would restart talks with the unions on restructuring the Sao Bernardo do Campo factory, and set a mid-September deadline for a deal to be reached.

Political criticism

The week-long strike, which began at the end of August, was sparked by VW's plans to restructure the business.

VW has argued that the plant is unprofitable as it is and must be overhauled if it is to get the extra investment needed to make new models.

Without new investment, the plant faces closure.

VW's stance has been criticised by Brazilian President Luis Lula da Silva, a former trade unionist who represented VW workers in the 1970s.

President Lula said the company should be looking at ways of recruiting new workers instead of reducing its workforce.