BY IAN GRANT AND CAROLINE BELLAMY
LONDON - Ford Motor Co. announced January 16 that it would cut 1,300 jobs at its Halewood plant near Liverpool, England by April 1997, taking the plant down to one shift. The company also plans to end production of the only model made at Halewood, the Escort, in 2000, threatening the plant with closure and the loss of another 2,500 jobs. Ford currently says that it wants to keep Halewood open as the sole European producer of a new "people carrier" vehicle, but this is contingent upon the granting of about 75 million (US$124.5 million) government aid for the project, and no union opposition to the current cutbacks.

The day after the announcement workers held a mass meeting at Halewood and took a near unanimous vote for a day of action the following Thursday. Mass meetings are to be held at other Ford plants across the United Kingdom to vote on a ballot for a strike action. Ronnie Jennings, a worker at Halewood for ten years, told Militant reporters, "If we get the backing of other plants we'll be all right. If not we'll have problems."

The job losses take place in the context of a European car market where despite the fact that sales are at a high - hitting the 2 million mark in the UK for the first time since 1990 - manufacturers' profit rates are falling. In the late 1980's UK car profit margins were 11 percent. This year they average 1 percent. "That's what we call profitless volume growth" said Colin Whitbread, an auto consultant with the Economist Intelligence Unit. This declining profit rate is not a feature of the motor industry alone, it is the cause of the world economic crisis. Average annual economic growth in the imperialist countries slipped to about 2.5 percent in the 1980's from more than 3 percent in the 1970's and 5 percent in the 1960's and continues to fall.

To increase profits in this situation, each manufacturer needs to produce and sell more cars. In Europe, and other developed parts of the world, most people who can afford to buy a car at prices that profit the manufacturer, already have one. The resulting lack of room for growth of the market as a whole - the European car market is forecast to grow by only 3 percent next year -means cutthroat competition as each manufacturer battles to increase its particular slice of the cake. This has led to too many vehicles being produced and a price war -both of which are cutting profit rates still further. Competition and the laws of supply and demand have come together to create a downward spiral.

This has led to a drive by manufacturers to cut costs through speedup, attacks on wages and conditions and ultimately the cutting of "excess capacity," as has happened at Halewood. No matter how cheaply a factory produces, if it is not running at full capacity profits are reduced as the proportion of overheads per car is greater. Jac Nasser, global automotive chief of Ford said of the closure, "The workforce at Halewood has done a yeoman-like job over several years. They have improved efficiency more than 50 percent. However the plant is running at 55 percent of capacity which is not good."

Ken Sanderson, who works on the line at Halewood, said, "We have done everything they have asked from us for the last 10 years - we can't do any more. If this factory goes down there will be complete devastation in this area."

The problems in the car industry "run from top to bottom across Europe" reports the weekly Observer, "Chronic overcapacity, oversupply, high costs, intense competition, low prices and low profits affect the job security of every employee."

The new version of the Escort will continue to be produced at Valencia in Spain and Saarlouis in Germany, despite the fact that wage costs are much higher in Germany than in the UK. But recent labor struggles in Germany make it more of a gamble to attack the unions in that country. J. Kidd, who has worked at Halewood for 20 years commented on the union actions in Germany, "We'll have to start doing that here. This is going to affect all the other plants. They'll all be affected eventually."

Caroline Bellamy and Ian Grant are members of the Transport and General Workers Union at Ford in Dagenham, London. Debbie Delange in Manchester contributed to this article.  
 
 
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