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Strike ends at GM plant in Brazil, talks continue

SAO PAULO, Brazil, April 29 (Reuters) - Some 10,000 workers at a General Motors Corp. auto plant in Brazil went back to work on Tuesday, ending a five-day strike as talks on a pay raise continued, company and union officials said.

A GM spokesman said production at its Sao Jose dos Campos factory in Sao Paulo state resumed early on Tuesday, though the company had yet to settle a salary dispute with the plant's employees.

Workers at the factory walked off the job last Tuesday to demand a bonus equal to 10.39 percent of their earnings from September to February to make up for a sharp surge in inflation that cut into their buying power.

They also wanted management to slash their work week to 36 hours from 40 hours and implement a so-called "inflation clause" that would guarantee a pay raise every time consumer prices jump more than 3 percent.

But union leaders agreed to scrap the last proposal at a meeting on Monday with company and government officials, who are keen to head off widespread salary demands that could further fuel inflation in Latin America's largest economy.

A union spokeswoman said that instead, GM had offered a one-time bonus of 900 reais ($310) to be paid in September, a proposal that workers voted to accept early on Tuesday before returning to their jobs. GM, however, declined to comment on whether it had agreed to pay the bonus.

The strike also disrupted production at two other GM factories in Brazil, at the nearby Sao Caetano do Sul plant and another in Gravatai in the southernmost state of Rio Grande do Sul. Both are supplied engines by the Sao Jose factory.

Production in Sao Caetano resumed on Tuesday, though the Gravatai plant was expected to remain closed until Wednesday, the GM spokesman said.

GM's Sao Jose factory produces Corsa hatchbacks and sedans, Meriva and Zafira minivans, and the mid-size S-10 pickup truck. On average it churns out 640 autos and 1,600 engines a day.

The Sao Caetano plant produces the Corsa classic sedan and pickup truck, and the Astra and Vectra compact models. The Gravatai factory only produces the compact Celta model.

The end to the strike comes one day after 2,500 workers at a Renault auto factory in Parana state went back to worker after winning a 500 reais bonus to make up for rising inflation.

On Friday, another 1,500 workers at a nearby Volvo truck and bus factory ended a 20-hour walkout after getting a 600 reais bonus, and Volkswagen AG averted a strike by offering a 500 reais bonus. ($1=2.905 reais)