Socialist Worker

Crisis hits the car industry as companies cut jobs

Issue No. 2138

There is a dramatic crisis sweeping through the car industry in Britain. New car registrations dropped by 30 percent in January alone.

Nissan has already axed 1,200 jobs from its factory in Sunderland.

Jaguar Land Rover has cut 1,450 jobs since the autumn and Ford is to make 850 redundant by May.

This pattern is reflected globally. Nissan is to cut 20,000 jobs worldwide. Honda has announced 3,100 redundancies.

On Tuesday of this week General Motors announced that it was reducing its workforce by 10,000.

The scale of the crisis has forced governments to step in with bailouts for the car industry bosses.

Last month, for instance, trade secretary Lord Mandelson offered loans to companies if they promise to make “low emission” cars.

The government is now considering implementing a “scrappage” scheme. This would involve owners of old cars receiving a subsidy as an incentive to buy a new car.

The chaos of the market means too many cars are being produced – yet the only solution is to encourage people to buy even more cars.

Bizarrely, at the same time some car manufacturers are raising the prices of their cars.

The car industry is a global business. Only 15 percent of the vehicles made in Britain are sold here. About 86 percent of cars bought here are made abroad.

Company bosses and union leaders alike typically cite this kind of “globalisation” as a reason why workers in Britain have to accept lower wages and worse terms and conditions.

But in fact the intricately linked nature of modern capitalism can mean that workers are in a powerful position to defend their jobs.

For instance, over 100 production staff at International Automotive Components (IAC) on Merseyside staged unofficial walkouts on Wednesday and Thursday of last week in a dispute over redundancies and conditions.

IAC provides plastic dashboard parts for Jaguar models on a “just in time” basis. Jaguar Land Rover’s Halewood plant is situated next door to the parts manufacturer.

As a direct result of the IAC walkouts, production at the main Halewood plant ground to a standstill for an hour and a half.

As this crisis deepens, the ability of workers to take action like this will be the one thing that can save jobs.

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