The Spanish plant opened by the American car manufacturing company Ford in 1976 in Almussafes, just outside the eastern city of Valencia, will continue in full production until at least 2013. The multinational corporation has decided to continue producing several of its main models in the factory after reaching an agreement with the General Workers’ Confederation (Unión General de Trabajadores, UGT [1]), which represents 63% of the workforce.[1] http://www.ugt.es/index1.html
Ford Motor Company plans to invest millions of euro in its Spanish factory at Almussafes just outside the city of Valencia. This initiative will secure the jobs of 7,500 employees over the next six years, as well as protecting the livelihoods of some 25,000 workers employed in subsidiary companies and suppliers. In exchange, the negotiating trade union agreed not to demand pay rises above the recommended price index and to allow greater flexibility regarding leave periods.
Medium-term future of car plant secured
The Spanish plant opened by the American car manufacturing company Ford in 1976 in Almussafes, just outside the eastern city of Valencia, will continue in full production until at least 2013. The multinational corporation has decided to continue producing several of its main models in the factory after reaching an agreement with the General Workers’ Confederation (Unión General de Trabajadores, UGT), which represents 63% of the workforce.
Despite a climate of restructuring and relocation in the automotive industry (ES0707039I, ES0601102N, ES0404204N, ES0304202N, ES0303202N), Ford still has faith in the profitability of the Almussafes factory with its 7,500 direct employees and a further 25,000 persons employed in subsidiary companies and suppliers. Ford currently contributes 8% of gross domestic product (GDP) in the Valencian economy.
Moderate demands by trade union
UGT has been negotiating the agreement with the company for two years. The other two trade unions which are represented in the company – the Trade Union Confederation of Workers’ Commissions (Confederación Sindical de Comisiones Obreras, CC.OO) and the General Confederation of Lab our (Confederación General del Trabajo, CGT) – were not involved in the bargaining process.
UGT made moderate concessions in exchange for the company maintaining employment over the next six years. Specifically, the union has agreed not to demand pay rises above the recommended price index (RPI). Furthermore, the workers have agreed to split their holidays, leaving one week for the winter. They also left open the option of closing the plant in July and August, when production is very low.
The UGT representatives in the company claim that these concessions are justified by the complex and difficult situation of the sector. For some years, the future of the Spanish Ford plant has been in doubt due to strained industrial relations and potential relocation opportunities (ES0111211F).
Commentary
Ford’s statement that it will maintain employment is of considerable interest, bearing in mind the current context of industrial relocation. Vehicle production declined by 3.6% in 2006. Indeed, the Spanish automotive components industry has lost over 5,000 jobs since 2000 through cross-border relocation by large multinational corporations.
However, it remains to be seen what will happen between July 2008 and January 2009, when the company is due to cease production of the current Ka and Fiesta models, and before it starts to produce the new Fiesta.
Emma Cerviño, CIREM Foundation
Eurofound recommends citing this publication in the following way.
Eurofound (2007), Ford to boost investment in Spain, article.
