Security guards of the German carmaker Volkswagen’s Anchieta plant try to block the way of workers to the management offices as they protest on the second day of an indefinite strike, after 800 jobs were cut by the company, at the plant in Sao Bernardo do Campo, 25km south of Sao Paulo, Brazil, yesterday.

Reuters/Sao Paulo

Workers at a Mercedes-Benz truck factory outside of Sao Paulo yesterday voted to stop work for 24 hours in a protest over fired colleagues, the second such strike in as many days as automakers cut payrolls in anticipation of a third straight year of slumping sales.
The local metalworkers union said Mercedes-Benz, a unit of Germany’s Daimler AG, had cut 244 workers at the factory and about 750 others remained on paid leave through April, out of about 11,000 employees at the plant.
A Mercedes representative said in a written statement that about 100 of the laid off workers had taken voluntary buyouts. The company confirmed the strike announced by the union yesterday morning.
On Tuesday workers at a Volkswagen AG plant in the same town, Sao Bernardo do Campo, declared an indefinite strike after the company cut 800 workers and warned of a pressing need to further trim staff.
The high-profile job cuts point to rising tensions in the auto sector, which produces a quarter of Brazil’s industrial output, after a slow burn of buyouts and paid leave over the past year.
Payrolls in Brazil’s auto industry shrank about 7% in 2014 as domestic vehicle sales fell by the most in a dozen years due to rising interest rates, weak consumer confidence and the end of long-running tax breaks for the industry.
The labour standoff is testing the mettle of President Dilma Rousseff’s new economic team, which took office promising an end to the cheap credit and tax incentives that have propped up key industries but wrecked government accounts.
In his inaugural remarks this week, Finance Minister Joaquim Levy blamed the favouritism shown to some industries for Brazil’s fiscal challenges and lack of competitiveness in many sectors.
Still, Brazil’s powerful industrial unions form the foundation of Rousseff’s Workers’ Party and have pressured the president to intervene in recent years to beat back the threat of job cuts, keeping unemployment low despite stagnant growth.
Even with the extension of temporary tax breaks since 2012, auto sales slipped 0.9% in 2013 and fell another 7.2% in 2014, a dealership association said on Tuesday.
The group forecast a further 0.5% slip in sales this year.