Saga of automobile industry restructuring continues at Ford-Genk

After the closure of Renault's Belgian plant and major restructuring at Volkswagen and Opel, in September 1998 it was Ford's turn to face the challenge of reorganisation in the Belgian car assembly industry at its plant in Genk. Up to 3,000 jobs could be lost, and negotiations are underway on ways to soften the blow.

Over the summer of 1998, news about the Belgian car assembly industry seemed fairly positive. Job cuts at Volkswagen had been prevented by means of work reorganisation (BE9808152F) and at Opel, fewer jobs than projected were to disappear (BE9803229F). Early in September 1998, however, a new blow hit the industry when it was announced that over the next two years, between 2,500 and 3,000 jobs, or about 25% of the current workforce, will be lost at Ford's Genk factory.

Although the number of jobs lost is similar to that following the closure of the Renault Vilvoorde plant in 1997 (BE9703202F), strong reactions from the employees' side have barely materialised at Ford Genk. The explanation is that the news did not come as a big surprise. After the closure of Renault and major restructuring at Volkswagen and Opel, and given an overcapacity of about 5 million cars in Europe, it was clear that Ford would not be able to escape some form of reorganisation itself. There seemed even to be a certain amount of relief because the cuts in costs are to be carried out by reducing fixed costs by 7% and not by closing the whole plant altogether. On the contrary, Ford's top management expressed its confidence in the Genk plant by announcing BEF 22 billion of investments in the modernisation of the factory.

This recent restructuring is indicative of the current climate of industrial relations at Ford Genk. Both sides are willing to talk and accept some fundamental compromises. Union representatives will try to limit the number of jobs lost and negotiate measures to prevent "uncushioned redundancies". The company is willing to invest in "humane forms of restructuring". An example is the promised BEF 5 billion investment in an industry park that would attract supplier companies (supplying, for example, bumpers, dashboards and seats) to the plant. New employment could thus compensate for the losses at Ford Genk itself. Work reorganisation and redistribution is an additional method under discussion.

All these issues remain to be negotiated. Before there is a sense of an acceptable global agreement between employers and employees, both sides agreed to not circulate premature "news" about the state of negotiations.