FRANKFURT -- DaimlerChrysler AG's luxury unit, Mercedes-Benz, could potentially reach a compromise on Tuesday with its works council over measures to extend working hours without compensation, the head of Mercedes said on Monday.
The development follows news Sunday that DaimlerChrysler top executives would forgo pay in a bid to resolve a worsening dispute with employees over longer working hours.
"I would say yes," Mercedes Car Group chief Juergen Hubbert told German television channel ZDF, when asked whether an agreement was possible when talks resume Tuesday.
In order for Mercedes to accept the works council's demand to guarantee long-term job security that extends past 2010, the unit has to find a way to save approximately 500 million euros ($622.2 million) in costs, he said.
The Mercedes chief said management was willing to do something to help keep jobs in DaimlerChrysler's home state of Baden-Wuerttemberg, but that: "This requires that our partners on the other side have the courage to agree to changes and to consider that (certain) things are no longer modern in our competitive world."
DaimlerChrysler has threatened to cut 6,000 jobs and shift production of the new C class mid-sized car out of the company's largest plant in Sindelfingen, if employees don't agree to a savings package to reduce labor costs.
Earlier on Monday, Daimler's top representative from the works council said that the work force would not let itself be blackmailed, but signaled that workers were serious about finding a solution.
More than 60,000 DaimlerChrysler workers in Germany downed tools on Thursday and protested again on Friday in a dispute over longer working hours which the company hopes to push through to help save 500 million euros.
The disruption continued over the weekend when more than 10,000 employees failed to turn up because their works council refused to agree overtime, delaying the assembly of 1,000 cars.
DaimlerChrysler Chief Executive Juergen Schrempp told German newspaper Welt am Sonntag that he was optimistic both sides would reach an agreement soon.
One of the stumbling blocks in the dispute is the company's attempt to end a 30-year-old agreement giving workers the right to a five-minute break from the production line every hour.
In practice, the breaks are no longer taken each day but saved up and tacked onto annual holiday.
DaimlerChrysler is following in the footsteps of manufacturing giant Siemens, which last month agreed a deal to increase working hours at two German plants to 40 hours a week from 35 without extra pay.