UPDATE 3-Brazil auto output slows; GM offers buyout

* GM offering voluntary buyouts at Brazilian factory
* Vehicle output wanes to slowest since Feb on high stocks
* Factories respond to weak demand with furloughs, layoffs

SAO PAULO, June 6 (Reuters) - General Motors Co said
on Wednesday it offered a buyout plan for workers at a Brazilian
factory after automakers in the country scaled back output in
May to the slowest in three months, idling factory lines to draw
down massive inventories.
GM said it was offering voluntary buyouts at its factory in
Sao Jose dos Campos as a result of intense competition in the
Brazilian market, as well as rising labor and raw materials
costs, according to a statement by the company.
The company added that the buyouts were a structural
adjustment to maintain its current production program. A
metalworkers' union at the factory said GM was offering a buyout
through June 15 without giving a target for staff cuts.
The cutbacks come as carmakers slow production and domestic
dealerships work to sell off inventories that are near their
highest since November 2008. Brazil's car market is slipping
from a year ago as Brazilians strain under record household
debts and banks reject more auto loans in response to greater
defaults.
Production averaged about 12,800 vehicles for each of the 22
working days in May, down from 14,000 per day in March and
13,000 in April, according to Thomson Reuters calculations based
on monthly data reported by national automakers association
Anfavea on Wednesday. February output averaged 11,500 per day.
Carmakers in Brazil produced about 280,800 new vehicles last
month, Anfavea said, up 7.6 percent from April due to a couple
of extra business days in the month.
Brazil's auto output in May fell 7.7 percent from the same
month a year earlier and the industry's accumulated production
in the first five months of the year remains about 10 percent
below the same period of 2011.
Carmakers have adjusted with daily furloughs to slow the
accumulation of stocks and the GM buyout follows economists'
warnings that layoffs may be around the corner after years of
rising wages and slipping productivity.
Unions at a Mercedes-Benz truck factory said last week that
the company will cut 1,500 workers as a part of layoffs
confirmed by German group Daimler AG.
Anfavea confirmed that vehicle sales rose 11.5 percent in
May from April due to the longer month, although average daily
sales fell from a year earlier for the fourth straight month.

Brazil is a key market for the world's biggest automakers,
including Italy's Fiat SpA, Germany's Volkswagen AG
and U.S.-based GM and Ford Motor Co.