MADRID, Dec 20 (Reuters) - German carmaker Volkswagen has withdrawn plans to cut 590 workers at its plant in Navarre in northern Spain after reaching an agreement with unions on flexible labour practices, a spokesman said on Friday.
Jose Zubillaga, plant spokesman, said the agreement reached with unions on Thursday "will allow us to tailor production to demand, avoiding dismissals."
Volkswagen's Navarre plant, which has around 5,000 workers, builds a new Polo model whose sales have fallen below expectations.
The agreement calls for across-the-board reductions of 10 working days per year and corresponding pay cuts. But the number of days may be adjusted depending on market demand.
The planned reduction is based on forecast output of 240,000 vehicles in 2003 from a planned 256,000 this year.