VW lays off 800 workers in Mexico

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German car manufacturer Volkswagen (VW) has said it will cut 800 jobs at its Mexican plant in Puebla, the site that produces the firm's Beetle model.

Production in Mexico could be cut by up to 20% this year after VW admitted it was considering further layoffs. The plant employs about 9,400 people.

VW revealed a 15% fall in sales in January, but said it had done better than the overall market.

Global car sales are down by an estimated 25% this year.

The last old-style Beetle rolled off the production line in Puebla in 2003. It is now the only plant manufacturing the new Beetle model, which was launched in 1998.

The factory in Puebla will close for a week in March and extend its Easter holiday.

Industry-wide production in Mexico could fall by up to 20% in 2009, according to the Mexican Auto Industry Association.