‘A company that only makes money is not good business’. This
phrase from Henry Ford does not appear to be an inspiration for Stephen
Odell, the current CEO of Ford Europe. Money seems to be the only
reason for its industrial policy, as shownby the announced plant
closures in Genk and Southampton (UK).The announcement on October 24 of
the plant closures and the layoffs of 4500 workers in Belgium and 500 in
the UK are another nail in the coffin of the European automotive
sector.
‘A company that only makes money is not good business’. This
phrase from Henry Ford does not appear to be an inspiration for Stephen
Odell, the current CEO of Ford Europe. Money seems to be the only
reason for its industrial policy, as shownby the announced plant
closures in Genk and Southampton (UK).The announcement on October 24 of
the plant closures and the layoffs of 4500 workers in Belgium and 500 in
the UK are another nail in the coffin of the European automotive
sector.
Picture of demonstration held on 11 Nov – More than 20.000 participated[The
Following article was written before a demonstration which took place on the 11th November, against the closure of the Ford factory in Genk. Twenty
thousand workers (including delegations from Germany, France and Spain)
and their families participated in the demonstration against the
closure of the Ford factory. Belgium has entered with both feet in the
second recession since 2008 and workers start to react.]
It is clear to everyone that nothing can stop the closure of the Ford
plant in Genk (nor in Southampton).Mourning has already begun.
Journalists fill the pages of newspapers with editorials, expert
opinions, the lamentations of politicians and all fill the television
studios. As for the arguments given for the closures, many are given.
Flemish capitalists point the accusing finger at foreign companies. For
many it is again the fault of globalization and, of course, everyone
complains – starting with the NV-A (Flemish nationalist party that won
the last elections and that self-proclaimed alternative in Flanders)
demand that the government should reduce labour costs.
reasons for the closures are: a combination of the new free trade
agreement with Korea and the need for Ford to refocus their production
in order to maintain good profit margins. In the last quarter, Ford had
before-tax profits of 1.7 billion Euros, an increase of 200 million over
the previous quarter. To continue with those numbers it has to close a
plant which was already running at 50% capacity and move production to a
plant like Valencia, with adapted models and a capacity utilization of
70%.
It is understood that the underlying reason for this closure is the
structural crisis of capitalism and overproduction in the economy,
especially in the automotive sector.
But the closure of Ford Genk, will have an impact beyond the 4,500
direct jobs destroyed. You have to add the direct providers, traffic in
the Port of Zeebrugge and flat steel making at Arcelor Mittal, as well
as the jobs of shop keepers in Genk: all suffer the consequences of the
closure of the car plant. In total, we are talking about another 5,500
indirect jobs. In the region of Limburg as a whole this will bring
unemployment figures to 40,000 at the end of the process.
In the same week in which Ford’s closure was announced, there was
more bad news. Volvo, in Ghent, is not extending 300 temporary
contracts. At the same time, steel companies such as NLMK and Duferco,
La Louviere, will cut 600 jobs. Earlier this month, mass layoffs had
already been announced at HP, Alcatel-Lucent, Balta, ECS Technics and
Arcelor Mittal. After Ford, it was Phillips’ turn to announced layoffs. A
real job bleeding is what we see in this country, which in theory has
escaped the crisis unscathed.
Excess capacity in the automotive sector in Europe is 30 percent. Car
manufacturers close and relocate their factories hoping to maintain
their profit margins and compete elsewhere. The policies of Fiat and
Volkswagen in recent months reveal the desperation and ‘short-termism’
which dominates the sector. The agreement with Korea and the entry of
low cost Korean models is the underlying reason for such changes.
Germany is the main destination for Belgian exports. But even
Germany’s economy is slowing down. Many companies which survived the
2008 recession no longer have the necessary financial room for manoeuvre
to absorb the current shock. This reinforces the effects of the
recession. European austerity policies depress demand even further.
Workers who still have jobs chose not to buy new cars. That "requires"
new "sacrifices", in Genk, in Southampton and tomorrow in Valencia too.
Crocodile Tears and Vultures
The reaction of the entire political establishment to the end
of Ford Genk was predictable: compassion, sincere tears, condolences
(sympathy of dubious origin) and the promise of "maximum support" by the
Flemish Minister-President Kris Peeters (which, despite everything,
says he is not a Chavez and rules out nationalisation).
Ford workers in recent years have been forced to become more
flexible: their wages were cut by 12 percent and they agreed to stay
home at times when demand declined. The unions ABVV Metal (socialist)
and Metea ACV (Christian) filled the workers heads with the idea that
flexibility was the only way to ensure job security…..
The strategy of permanent concessions to the demands of the employers
has not overcome the contradictions of the system. That is clear and
should be a lesson for other car workers in Europe and also for their
unions.
After hypocritical crocodile tears filled whole buckets, we now have
the cries of the vultures circling around the corpse of Ford Genk.
Everyone talks about "high labour costs", but in fact labour costs
represent only 5.5 percent of the total production cost of a car in
Genk. According to an estimate by Agoria, the employers’ organization in
the metal industry, wages in the Belgian automotive sector are also 5
percent cheaper than in Germany. It is rather the pursuit of profit
(more than 8 billion profits for Ford) and the fierce competition
between companies that explains the reason for the closure.
And as the workers in struggle at Ford Blanquefort (France) say "Today it falls on Genk, Southampton and Dagenham, tomorrow it may fall on Cologne and Valencia." In
a letter to the other workers of the industry they explain that the
"inevitability" of the plant closure is a myth and that they should
fight back.
The Best Social Plan: Keep the Factory Open
The sadness and surprise at news of the closure have been transformed
into anger and militancy among Ford workers. The workers feel betrayed
after having ‘given the best of themselves’ at the price of burnouts and
depressions. Now the years old mood of ‘acceptance’ of their fate has
changed in a few hours. The factory gates were blocked, automotive parts
and assembled vehicles are now held by the unions. 250 workers also
went to the European headquarters yesterday in Cologne (Germany)
lobbying the European works council and asking for solidarity of their
colleagues.There they were treated as hooligans by the German police (See video).
A belgian journalist declared on television that ‘Ford has sent a
massive police force against the workers as if they were gangsters or
heavy criminals. On November 11 there will be a national march in
support of Ford workers. In this march the entire Belgian labour
movement will be present. It’s a good first step, but we need a
strategy. It is also an opportunity to make international contacts with
unionists in struggle at Southampton, and delegations from other
countries.
Much attention is given to the need for a social plan and redundancy
payments. However, the best social plan is to maintain all jobs and keep
the factory open, because in the present context a departure bonus is
no adequate response to a reduced monthly income and the need to repay
debts. A severance payment is only a plaster on a wooden leg.
If Ford management persists in closing the plant in Genk, as seems to
be the case, then the best solution is the requisition of the plant by
the government. How? Not by asking Ford nicely for permission to buy
their business! The price of Ford Genk has already been paid for some
time by the workers through wage reductions and the government through
"reduction of social costs" and direct subsidies. The regional
Minister-President of Flanders, Kris Peeters, rejected the possibility
of the government intervening in Ford. ‘I don’t want to be the Hugo
Chavez of Flanders who decides what has to happen with industry’. In
saying so he has unwillingly increased Hugo Chavez’s popularity with
Ford workers…
Nationalisation of the Ford factory is nevertheless the best solution
for the workers. An alternative plan of production for environmentally
friendly vehicle manufacturing oriented towards the development of
public transport should replace actual production. And for this, the
factory cannot be run on capitalist or bureaucratic lines. It must be
put under workers’ control and management – put in the hands of the
workers, the government and representatives of the consumers.
