Workers' Weekly On-Line
Volume 53 Number 16, June 3, 2023 ARCHIVE HOME JBCENTRE SUBSCRIBE

Workers' Forum

Warnings Issued by Car Monopolies


Motor industry contribution to UK economy up to 2021 - Image Statista

Three of the largest international car firms have urged the British government to renegotiate the Brexit agreement. Ford and Jaguar Land Rover have joined Stellantis in calling for Britain and EU to postpone tighter "rules of origin" that are to impose taxes on auto exports that, they claim, may derail the move to electric vehicle production. These rules, by which exports of British-made cars would be subject to 10% tariffs, are set to take effect in the new year. Britain would lose its competitive edge, they say, as a location for vehicle manufacturing, if the government cannot agree to maintain the current regulations until 2027.

Stellantis, the parent corporation of Vauxhall, Citroen, Fiat, and Peugeot, has issued a warning that it might be forced to shut down its British factories if the government does not renegotiate the Brexit deal. The monopoly claims that tariffs will make it more expensive to construct cars in Britain than in Japan or south Korea, casting doubt on the profitability of its facilities in Ellesmere Port and Luton. It has urged ministers to reach a deal with the EU that will keep things as they are until 2027 and review the arrangements for parts manufacture in Serbia and Morocco. Additionally, it has warned that the absence of British-made batteries will put the auto sector "in trouble" and deter people from purchasing the vehicles.

Consumers, say the monopoly, would be less likely to purchase the vehicles because it is no longer able to comply with Brexit trade rules regarding where parts are sourced. Due to rising prices for energy and raw materials, electric vehicle manufacturing in Britain is becoming uncompetitive, and unsustainable operations will cease to exist, they warn. Stellantis met with Kemi Badenoch to discuss its issues with the 2025 renegotiation of Britain-EU trade agreement.

Meanwhile, the government is pleading with the EU to delay a change in manufacturing rules in the Brexit trade deal, and has reported "productive" talks with the EU on tariffs and rules of origin. Andy Palmer, a former chief operating officer at Nissan, told BBC Radio 4's Today programme that it is impossible to comply with local content regulations unless the battery is sourced from Britain or EU.

Taking advantage of this context, and stressing that the automotive sector in Britain employs some 800,000 people, the large car manufacturers are pushing for further pay-the-rich schemes. The government already supports the industry through the Automotive Transformation Fund and the Advanced Propulsion Centre. The big firms are citing the example of the US, where the government there is providing money as an additional incentive to car producers. Jaguar Land Rover have requested the British government assist its construction of a battery plant. At the same time, Elon Musk and the Spanish government are attempting to persuade Jaguar Land Rover to construct "gigafactories" in Spain.


Nissan workers in Sunderland fighting to defend their pensions in 2020

Such pay-the-rich schemes come about as governments do the bidding of the monopoly cartels and big investors, who will only invest their huge sums of accumulated social value if an agreement for state subsidies can be reached. In this case, the demand is that the government pays much of the price for new battery production facilities. The industrial and financial oligarchs demand constant and fast returns, and in the absence of such pay-the-rich schemes, will only invest in new facilities as lenders, and then only if they can be certain that interest payments start immediately.

The debate over prices and supply chains leaves out monopoly ownership of the industry, where the largest players both exercise control over the market price of what they produce and compel suppliers further up the supply chain to lower the prices that these monopolies pay. The resulting price inflation means additional profit for these monopolies, but it also puts pressure on the reproduced-value (wages) claimed by workers and the purchasing power of that value, and in general in adds to disruption across the interconnected, socialised economy.

Attacks on the working class call for them to concede part of their reproduced-value in the form of wages and benefits. The threat of closure is a significant part of this pressure, and serves to disrupt workers from organising and fighting to catch back up with price inflation and to regain the dignity of their labour. The working class faces the challenge of taking a unified, comprehensive stance to defend its rights and claims given the actual circumstances of monopoly control within the socialised economy, so as to defend its rights and claims on the social product it produces. Workers' Forum echoes the call of the working class as it loudly declares: Enough is Enough!

(Sources: BBC News, The Guardian, The Independent, Sky News, The Telegraph)


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