By Jason Lange

PUEBLA, Mexico, Sept 20 (Reuters) - When Marxist saboteurs blew up natural gas pipelines in Mexico last week, the only factory in the world to make the Volkswagen New Beetle shuddered to a halt that lasted for seven days.

The Sept. 10 bombings by the Popular Revolutionary Army, or EPR, hit so hard that they will dent figures for Mexico's crucial industrial sector this month.

That is more bad news for an economy already stunted by the U.S. slowdown. President Felipe Calderon's government is worried by the ability of a small group of guerrillas to hit at the heart of the economy of a major U.S. trading partner.

The blasts cut energy supplies to dozens of major export companies, costing them thousands of hours of production.

At the Volkswagen <VOWG.DE> plant in the city of Puebla, workers in blue jumpsuits were hauling caldrons of molten steel toward engine part molds when bombs ripped apart six ducts in central and eastern Mexico. The pipelines move about quarter of Mexico's natural gas.

"We noticed gas pressure was falling quickly and so we had to shut off the furnaces right away," said Coheto Ladino, who helps operate several giant kilns fired by natural gas.

Within hours, the entire 740-acre (300 hectare) factory, which sends two-thirds of its output to the United States and Europe, was paralyzed. Production did not resume again until last Sunday.

"All the manager types are nervous about reaching their production goals," said Volkswagen engineer Carlos Varela.

Manufacturers across the the country felt the same bite from the blasts, the second such attack in two months.

Production stopped or slowed at around 2,000 factories that produce everything from surgical instruments to cement, according to Mexican manufacturers' group Canacintra.

The government says the attacks will weigh on Mexico's crucial industrial sector, which provides about a quarter of the country's economic growth.

"This will clearly show up in the numbers," said Miguel Messmacher, the finance ministry's chief economist. "Obviously there is a certain amount of worrying going on."

BIG BLOW

Messmacher said the government had not yet estimated how much the blasts slowed factory output, but Canacintra President Miguel Maron estimated the attacks have cost manufacturers about $1.6 billion.

State oil company Pemex, a top supplier of crude to the United States, said the blasts will cost it hundreds on millions of dollars, though oil exports have not been affected.

More than 80 percent of Mexican exports, which include the New Beetle and Chrysler's PT Cruiser, go to the United States.

Mexico has deployed soldiers and federal police to protect pipelines but Calderon has said it is almost impossible to completely secure the vast network.

John Bailey, an expert on Western Hemisphere security issues at Georgetown University in Washington, said Calderon needs to stick the army and intelligence services on the job of tracing EPR leaders to stem further attacks.

"If the Calderon government assigns this top priority they can track down elements of this group pretty fast," Bailey said.

The EPR burst into public view in 1996, firing automatic weapons into the air at a political rally in the poor southern state of Guerrero to protest a police massacre.

Within months the group, which calls for land reform and ultimately a socialist state, launched a string of lethal ambushes on rural police and army bases in several states. Dozens of police and soldiers were killed.

The EPR's new strategy of bombing energy pipelines began with a wave of attacks in July that also cut natural gas supplies to businesses. This month's attacks were on an even larger scale.

Some experts say the power of recent bombings may be a sign the EPR, believed to number under 1,000 members, is better funded than in past years.

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