BRAZIL MOTOR INDUSTRY SENDS 9,000 ON LEAVE
Brazil's motor industry, facing the
worst crisis of its history, today sent thousands of workers on
collective leave because of a sharp drop in demand.
    Company spokesmen said Autolatina, which last Friday laid
off 4,000 workers, sent nearly 9,000 of its 56,500 employees in
Brazil on collective leave until July 12.
    General Motors do Brasil said it would give 10 days' leave
to part of its 22,000 workforce from Wednesday.
    Fiat is giving 2,000 workers a month's holiday from July 6.
    Jacy Mendonca, industrial relations director of Autolatina,
a merger of Volkswagen and Ford in Brazil and Argentina, said
last week this would be the worst year ever for Brazil's auto
industry.
    He forecast that 1987 would be worse than 1981, when
domestic sales dropped 40 pct to 580,000 units.
    "This year we'll be lucky if we can sell 550,000 units," he
said.
    Since Friday there have been two positive developments for
the industry. The government announced that it was scrapping a
15 pct surcharge on all new car sales.
    The surcharge, created in July last year, was originally
set at 30 pct to help curb a car-buying boom and was in theory
refundable.
    Brazilian car distributors, which since June 16 had halted
all car purchases in protest against high government taxes,
responded to the government move by resuming purchases.
    But industry spokesmen said taxes on vehicles were still
high, 108 pct, and the sector still faced major problems.
 Reuter
