General Motors said Tuesday it had suspended output at a plant in Brazil and sent workers home with paid leave ahead of tense talks with unions and government representatives.
The move at the Sao Jose dos Campos complex near Sao Paulo -- which makes pickup trucks, engines, as well as Corsa and Meriva cars -- comes after a 24-hour strike there on July 17 in protest of alleged plans by GM management to cut up to 2,000 jobs due to difficulties facing a production line making older models.
In a statement, GM said a new round of negotiations with the Metalworkers Union and the government was scheduled for Wednesday. Ahead of the talks, workers should stay home and "await new instructions," it said.
The Metalworkers Union called the decision "anti-democratic," claiming it violated Brazilian law.
"This attitude only increases insecurity among workers and clearly exposes the car maker's plan to carry out massive layoffs and prevent resistance by the workers," it said in a statement that urged the government to take a firm stance toward GM.
Last week, the US automaker insisted it had made no decision on layoffs or on shutting down production at the struggling line in Sao Jose dos Campos, a city of 640,000 people located 80 kilometers (50 miles) from Sao Paulo.
Brazil's current economic slowdown has generally put a damper on nationwide auto sales, which fell 1.2 percent in the first half of 2012, compared to the same period last year.