Vauxhall is the British subsidiary of General Motors, which is carrying out a wave of job cuts at its plants across Europe and North America.

At the company's headquarters workers demanded a meeting with Vauxhall chairman Nicholas Reilly, forcing their way in and besieging the offices until he came out to address them. "Judas!" "Liar!" "Resign!" they chanted.

"We should fight to save our jobs," said Felix, a worker at Vauxhall, speaking outside the plant gate. "We work relentlessly hard and then this happens two weeks before Christmas."

Alex Senville, who has worked at Vauxhall for 12 years, said, "We've given a lot. They guaranteed us that we'd save our jobs and they've fooled us." Senville was referring to previous votes by the workforce to accept "flexible" working hours and take a pay cut.

"We only found out they were closing the factory down by listening to it on the radio--I was in work when I heard it," Christopher Stirrup told the press. By announcing the closure just before a four-week seasonal shutdown, the company hoped it would minimize joint action by workers.

Throughout the following day, workers stopped the production line to protest the job cuts. At the Vauxhall plant in Ellesmere Port, near Liverpool, 1,500 workers walked off the job to show support for workers at the Luton plant, as did workers at a warehouse in Luton.

Workers at the General Motors plant in Antwerp, Belgium, also walked out to protest the job cuts, which will total more than 6,000 across Europe, including in Germany.

At least 2,000 of the 3,000 workers at Vauxhall will lose their jobs, initially through voluntary redundancies (layoffs) at the Luton and Ellesmere Port plants and at the IBC truck plant, a joint venture between GM and Isuzu.

The Vauxhall plant at Luton is the biggest factory in the town and the closure, scheduled for early 2002, will have a devastating impact locally. The Transport and General Workers' Union (TGWU) estimates that up to 8,000 jobs will be lost in the surrounding area, including in the auto parts industry.

In its cost-cutting efforts to gain a competitive edge over rival auto companies, GM is planning to cut jobs at its U.S. and European plants amounting to 10 percent of its total workforce. In the United States the company will phase out its Oldsmobile division.

Vauxhall blamed the closure on "a response to changing European market conditions and overcapacity in the car market." Although the company's car sales in Europe are running at a record 17 million units, this amount is much less than its factory capacity, which is 23–24 million units.  
 
Drive to cut costs at workers' expense
Overcapacity--that is, capacity to make more products than employers can sell at what they deem to be a sufficient profit--is a result of the declining rate of capitalist profit. In an attempt to increase the rate of return on their investment, each individual capitalist strives to increase productivity and competes to win new markets. The resulting overall increase in supply, however, depresses prices and, with it, profits. It also means too many companies chase too few buyers, and each individual company's market share goes down, not up, leaving it with the capacity to make more than it can sell at a profit.

Registrations of new Vauxhall cars fell by 6.7 percent in November, and the company was forced to cut prices on its Vectra model, made at the Luton plant, by an average of 9.2 percent to counter price cuts by its rival Ford. The European Union auto market as a whole contracted by 15.9 percent in July.

This vicious circle, and its impact on workers, has been evident in the auto industry for some years now, as manufacturers drive to cut capacity and increase productivity. In November 1998, the chairman of Ford predicted that the world motor industry would shrink to six manufacturers, as a "global dogfight" forced the existing 40 manufacturers to "rationalize."  
 
GM attacks working conditions
GM has indicated it will attack the working conditions of auto workers at its remaining plants. In a statement released December 12, the company declared that "lean manufacturing implementation will be accelerated at European plants, to obtain the productivity levels currently demonstrated at the benchmark Eisenach facility." GM is still reviewing its European capacity and other decisions could yet be taken.

This message was echoed by bosses at the IBC plant, who announced that the company would need to "review working practices" after the announcement of the closure of the neighboring Vauxhall plant in Luton. GM's share price rose following the announcement of the job cuts.

Company chairman Reilly has tried to pin some of the blame on a recent consumer campaign to reduce car prices, saying the price cuts have undermined the company's profitability.

The British government indicated that it would not attempt to prevent the company from closing the Luton plant. "Our key aim will be to find new job opportunities to replace those being lost over the next year," declared Trade and Industry Secretary Stephen Byers. TGWU general secretary William Morris likened the government response to "sticking plaster around a broken arm."

Local Labour member of Parliament Kelvin Hopkins asserted that the high value of the pound was a reason for the planned closure. GM boss Richard Wagoner, however, played down attempts to blame the Luton closure on the British government's decision not to join the European single currency, the euro.

Union leaders expressed shock at the decision to close the Luton plant and called on the company to reverse the decision. Morris stated, "The company has shown a cynical disregard for the agreements signed with their workforce and the government. Only three months ago they confirmed commitment to continue production at Luton."

In response to union officials' charges of "betrayal" for planning to shut down the plant, the company chairman stated, "The agreement said that would be the intention unless there were major changes in the car industry. There have been huge changes in the industry." As one Financial Times commentator put it, "In the motor industry, there is no such thing as a secure future."

The Vauxhall announcement follows the decision by Ford to end production at its Dagenham assembly plant in March 2002 and the threatened closure in April 2001 of the Rover auto plant in Longbridge, Birmingham. At the Rover plant, following a campaign by workers and unions culminating in a march of 80,000 through Birmingham, the largest union demonstration in this country in nearly a decade, workers won some time as the government intervened to set up a deal for the buyout of the plant after the German owners, BMW, had threatened to close it.  
 
 
Front page (for this issue) | Home | Text-version home