On Sunday, United Auto Workers rejected a tentative six-year labor agreement covering employees of Volvo Trucks’ New River Valley Truck Assembly Plant in Dublin, VA.

Ratification of the agreement is required for the company to proceed with a planned plant modernization and expansion. The Associated Press reports that Volvo will drop the expansion if there is not a contract soon, even though the current contract does not expire until March of 2000. The new contract would have meant 30% less pay for new workers, as well as a different health care plan, according to AP.
Volvo says discussions with the UAW are continuing, but a UAW spokesman told AP that no talks have been scheduled.
The plant expansion was announced just last week by Gov. Jim Gilmore in his annual State of the Commonwealth speech. Plans call for Volvo to invest $148 million in the plant, creating 1,300 new jobs. The plans also are dependent on the state legislature approving a package of economic incentives valued at more than $100 million over 10 years, according to published reports.