World News

GM plans to extend shutdown of Brazil auto production by 60 days

(This April 9 story corrects start date of production shutdown to March 23, with furloughs starting on March 30.)

By Marcelo Rochabrun

SAO PAULO (Reuters) – General Motors Co <GM.N> plans to keep its Brazilian factories shut down for at least 60 more days due to the coronavirus crisis, the company said Thursday, as the final batch of unionized workers voted on the automaker’s proposal.

GM’s plants in Brazil have been shuttered since March 23. On March 30 the company put its workers on furlough, but kept their pay intact as it made employees use up vacation days.

But as the pandemic has worsened globally and holiday allotments have dried up, GM has had to look for more drastic measures in South America’s top auto producer. Now its factories in Brazil, where for several years Chevrolet has been the country’s best selling brand, will be shut down at least until mid June.

The timeline puts Brazil behind the schedules set by automakers in Europe, where companies have said they might begin building vehicles by the end of this month. In The United States, automakers including Fiat Chrysler Automobiles <FCHA.MI> and Toyota Motor Corp <7203.T> are hoping to restart production in early May.

To be sure, GM has not set reopening start dates elsewhere in the world.

Brazil has more coronavirus cases than any country in Latin America and its right-wing President Jair Bolsonaro has been criticized for minimizing the severity of the disease.

GM said all its Brazilian workers except for one have agreed to the shutdown and for a plan to cut salaries by up to 25%. The remaining union, based in Sao Jose dos Campos in Sao Paulo state, will finish voting on the proposal on Thursday night.

If the crisis does not allow workers to resume auto production within 60 days, GM may extend the shutdown to 90 days, according to a document shared with workers and seen by Reuters.

(Reporting by Marcelo Rochabrun; Editing by Christian Plumb)