Given the current furore surrounding over-capacity in Europe, I’ve been in what many would regard as the heart of the Continent’s decision-making automotive process, namely Brussels.
National governments might not necessarily agree with that – and I often find myself ranting about Brussels – but like it or loathe it the Belgian capital is where the movers and shakers of the car industry are – certainly from a political and labour body point of view.
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One of my visits was to see the European Metalworkers’ Federation (EMF), whose impressive headquarters contains some pretty clever people working on ways to address the infamous capacity issue – with of course a bias towards protecting their members’ livelihoods.
But rather than focus on the raw numbers of vehicles exiting Europe’s factories – or indeed their almost certain decline in the years ahead – the EMF is bemoaning what it sees as a lack of a coherent industrial policy that takes in areas surrounding personal mobility issues.
“We have to get a different vision of how we deal with mobility and transport,” EMF policy adviser Wolf Jacklein told me in his tenth-floor office. “The OEMs still focus on mobility tools rather than services, rather than for example, car sharing, lending cars, all kinds of services around mobility, that is obviously what we have to do.”
The policy adviser notes part of that switch to services is driven by what he claims are increasing numbers of young people who are not only less interested in owning cars, they don’t even have a driver’s licence. For someone like me, who had their introductory driving lesson on the first legal day I was able to in the UK, i.e., 17 years old, that comes as something of a surprise, but I’m increasingly hearing it from more and more sources.
“The industry is still on this nineteenth-century model of selling ownership for sexy products,” said Jacklein. “People cannot afford to buy fuel at EUR2 (US$2.70). If you do not adapt to this change, you will be at a loss completely.”
But the EMF is not advocating wholesale closures of car factories – far from it – the union body described to me this week as “complete nonsense” the reduction mooted in some quarters of European production that could see plants such as Ellesmere Port in the UK, Bochum in Germany and perhaps two sites in Italy, facing the axe.
The EMF’s view – much like that expressed to me in Sweden last week by Scandinavian supplier body FKG that there had been a flight of “competence” out of the country following Saab‘s bankruptcy – was skills needed to be maintained and built on from manufacturing – even if that meant adapting to non-traditional car making.
“You cannot just close factories – you need to transform industry into something else,” said Jacklein. “If you close factories in Italy and France, you will destroy the whole industrial tissue which means you destroy for the long term.”
All well and good, but you can’t turn production from one thing to another – Jacklein mentioned electromobility for example – at the drop of a hat. And frankly, there seems to be almost zero appetite for anything that moves being electric at the moment as European populations struggle with severe austerity budgets and plunging consumer confidence.
The EMF is nothing if not realistic however, insisting its role on a European level was to make sure enough lead time, a sufficient buffer, was put in place, to cope with what are surely going to be swingeing production cuts.
Equally, being at the heart of political Europe, the EMF has its finger on pulse of events that are not necessarily industrial in nature, but nonetheless could have a dramatic effect on them.
France is currently in full presidential election swing, with the two big beasts of the jungle, centre-right Nicolas Sarkozy and socialist, Francois Hollande, presenting radically different agendas to cope with the economic crisis that has certainly not left the country untouched.
The campaign has been given added piquancy with the recent announcement by General Motors and PSA Peugeot of a mooted alliance that has set the labour bodies abuzz with speculation as to its potential employment effect.
Separate to that deal, last year PSA announced 6,000 European redundancies, of which the lion’s share are in France, while any prospect of further cuts could well depend on the outcome of the presidential race.
“In France, it is election [year],” said Jacklein. “The President could have an impact on what PSA could do in France. Until the first round of the election, nothing is clear about how that will turn out.
“I don’t see a socialist President accepting in the first year of his presidency, major plant closures in France. That would be devastating. PSA putting into action what they want to do depends completely on the outcome of the campaign.”
It’s clear the unions want to be – and will be – heavily involved in either mitigating the effects of proposed redundancies across Europe as manufacturers eye drastic capacity reduction or being involved with alternative manufacturing solutions.
But they’re going to have to come up with a lot more meat on the bones of those alternatives.
Those losing their jobs – just ask the redundant Saab workers in Trollhattan – need concrete solutions and fast as the financial drawbridges pull up.
