By Rebecca Harrison
South Africa's biggest auto industry union urged the government to rescue any group facing collapse and said on Sunday companies which benefit from bailouts must agree to protect jobs.
The National Union of Metal Workers of South Africa (Numsa) said the government should also make incentives to the motor industry - one of the biggest in manufacturing and key for employment - conditional on guaranteeing jobs.
South Africa's motor industry has been badly hurt by the economic crisis, with local new vehicle sales sliding 36 percent in February, the biggest monthly decline in more than two decades. Exports have also been hit as developed markets reel.
Component makers have asked for a R10-billion ($999-million) rescue package and the government is due to unveil plans to help struggling industries this month.
"The state must implement urgent measures to bail out any company facing closure," Numsa said in a statement following a conference on job security, adding aid packages could include low interest and emergency bridging loan.
"Such bailouts must however be conditional on a moratorium on retrenchments," it said.
The union said the auto industry had already shed 40 000 jobs in South Africa and quoted industry leaders as saying another 30,000 were at risk this year.
Volkswagen AG's South Africa unit said 2009 production was expected to fall 30 percent, but added it had scrapped plans to close for two weeks over Easter after a big export order from Europe for 6 000 of its subcompact Polo model.
It said the order was a result of the German government's car purchase incentive scheme, which it said had spurred demand.
South African President Kgalema Motlanthe told a conference on Saturday companies and unions must work together to prioritise job protection and invest in training.
Numsa also reiterated the Reserve Bank should review its inflation targeting policy - a call made repeatedly by unions, who want more aggressive interest rate cuts to spur growth.