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October 22, 2004

SPAIN: Government welcomes Seat Ibiza’s full return to Martorell

Spanish industry minister Jose Montilla has welcomed Volkswagen’s decision to return full production of the Seat Ibiza to Martorell, Spain, next June.

By bcusack

Spanish industry minister Jose Montilla has welcomed Volkswagen’s decision to return full production of the Seat Ibiza to Martorell, Spain, next June.

The long-awaited move, “shows that Spanish industry can compete with countries that have lower labour costs,” Montilla told local radio Antena 3. Spain has been fighting to contain a corporate relocation spree to lower-wage countries, particularly in Eastern Europe.

In a statement, Seat confirmed the return of 10% or 20,000 units worth of Ibiza production to the blue-collar town of Martorell, which suffered a setback when the output was shifted to a lower-wage plant in Bratislava, Slovakia in 2002.

Volkswagen decided to hand back production of the emblematic Spanish model (which has sold 3.3 million units since launched in 1984) to the Catalan plant after it showed big flexibility and productivity improvements under a new collective labour agreement signed in May.

The move is expected to save up to 500 jobs which would have eventually become redundant in the 16,000-strong factory, trades union sources have said.

Martorell is expected to churn out 2,200 Seats per day next year, up from 2,000 now, according to unions. The factory makes the Altea, Ibiza, Cordoba, Leon and the new Toledo models.

Ivan Castano

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