STOCKHOLM - World number two truck maker Volvo said on Monday its Powertrain unit had agreed with unions on cutting working hours and wages at its operations in Koping, in central Sweden.

The company said in a statement the deal meant the company would revoke redundancy notices given to 25 white-collar employees at the unit.

The deal, which entails a 20 percent cut in working hours and a 10 percent wage reduction, would be in force from June 1 through to March 30, 2010, it said.

A preliminary deal had also been struck with the main blue-collar union which, if finalised, would mean that 600 workers given redundancy notices in April would not be laid off, the company said.

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