|Volume 50 Number 23, June 20, 2020||ARCHIVE||HOME||JBCENTRE||SUBSCRIBE|
Japanese multinational car manufacturer Nissan has assumed a dominant position over the economy in the North East of England. Some 7,000 workers work in the Washington plant, although the majority are currently furloughed as a result of production being halted by the coronavirus outbreak. Washington is a large town within the city of Sunderland, in the county of Tyne and Wear.
Nissan has angered workers by the closure of its defined benefits pension scheme after first proposing reducing the company's contributions. About 1,800 workers are set to lose out as Nissan has decided that the scheme is "unsustainable". The company are making the excuse of the virus to end paying into the scheme as so many workers' contributions have been lost.
Unite the union called the pension closure plan opportunistic. Unite's national officer for the car industry, Steve Bush, said that there was anger as the scheme's closure would hit workers who were the bedrock of the Washington plant's success.
"This is the best, most-efficient car plant in Europe and people with 20 or more years of service have got this extremely disappointing news. Unite warned last week that proposed efficiency savings at the plant must not be used as an excuse to attack staff terms and conditions," Steve Bush said.
He added, "The loss of the jobs of our Spanish colleagues is a regrettable reminder that automotive manufacturing is facing tremendous challenges."
Already Nissan has sacked temporary workers and will not be extending the contracts of almost 250 of them at its Washington plant. Nissan adjusted its production as there is a slump in demand. Production resumed earlier this month but with reduced volumes.
Nissan also revealed what it claimed was a £5bn net loss in the last financial year, which was the worst result for more than a decade. Nissan said that worldwide sales of its vehicles between January and April had dropped by 31.1% in comparison with the same period last year. The number of models produced by Nissan will be taken down from 69 to about 55 over the next few years, focusing instead on electric vehicles and sports cars.
Workers have been told to pull out all the stops to work flexibly to get costs down and increase productivity. They are advised that they should be grateful that they are not in the same position as their counterparts in Spain and Indonesia, where plants closed. They should be thankful for the small mercies of the decision-makers, is the message!
Nissan chief executive Makoto Uchida, to placate opposition to their plans, tried to assuage opposition by saying the company would maintain production at its Sunderland plant. Can this be the case while Nissan is closing plants in Spain and Indonesia?
The Japanese giant's global restructuring programme is driving its standpoint across the world. The carmaker also announced it will close its factory in Barcelona with the loss of about 2,800 jobs, prompting protests at the Spanish plant. The factory and its nearby facilities employ about 3,000 workers, but unions reckon closures could indirectly affect as many as 22,000 jobs. Barcelona workers started an indefinite strike in early May after initial plans outlined a 20% cut to the workforce.
Ashwani Gupta, the Japanese company's global chief operating and performance head, has said that Nissan's commitment to Sunderland could not be maintained if there were not tariff-free EU access; 70% of cars manufactured at Sunderland which are sold in the EU are said to face tariffs of 10% under World Trade Organisation rules.
Mr Gupta said, "You know we are the number one carmaker in the UK and we want to continue. We are committed. Having said that, if we are not getting the current tariffs, it's not our intention but the business will not be sustainable. That's what everybody has to understand."
Nissan has recently said it has decided to focus on several "key markets", including Japan, North America and China. They will keep a presence in Europe but leave more room for alliance partners there, such as Renault.
Nissan is part of a three-way cartel-alliance with Renault and Mitsubishi, which are restructuring global operations to enable them to work more closely and cut costs. Nissan's current strategic partner and 43%-shareholder, Renault, has been in negotiations to operate capacity thrown up at Sunderland. Renault denies what is taking place behind closed doors. The French government has a 15% stake in Renault, another company that is cutting jobs in major structuring too.
Destruction of the productive capacity in the region by closing the Sunderland plant would be devastating. It cannot be allowed to pass.