Renault closes assembly plant in Vilvoorde without prior notice
Without any prior notice or consultation, Renault announced on 27 February 1996 the closure of its production plant in Vilvoorde (Belgium). The decision means the loss of 3,100 jobs.
This action, which came as a complete surprise to the 3,100 employees, is part of the French-owned motor manufacturer's "new industrial strategy" of concentrating production to cut its financial losses. Michel de Virville, managing director of Renault, announced the closure adding that:
"the management and employees of Renault Vilvoorde are in no way to blame for this decision which was not taken on the basis of productivity, compensation costs, quality or the dedication of managers or employees."
The fact that Renault did not announce the closure or even its possibility in advance, let alone negotiate with union and/or government representatives, has left a sour taste in the mouths of everyone involved. In fact, union leaders claimed that Renault had initially planned to ship the assembled cars (about 4,000 of them, valued at BEF 2 billion) out of the plant before announcing the closure. When this plan did not work, the closure was instead peremptorily announced at a press conference in a hotel in Brussels. The families of employees at the plant received the news on radio and television before some of the employees themselves. Jean-Luc Dehaene, the Belgian Prime Minister, and Luc Van den Brande, Minister-President of the Flemish Government, reacted with perplexity to the announcement. Mr Van den Brande added that internal French politics had been given priority over the productivity and quality of the plant in Vilvoorde. They both criticised the obvious lack of communication by top Renault management and expressed their serious concern over the social consequences of the closure for thousands of families.
Immediately after the announcement, the plant was occupied by the employees and a spontaneous march against the decision gave voice to the anger, frustration and incomprehension of the workers and unions. Union representatives were prompted to blame Renault for not keeping its promises particularly because, in the early 1990s, they had agreed with management on the introduction of greater flexibility in the company in exchange for new investment, which had never been fully carried out.
The unions announced that they would fight the decision with all possible means and that they would demand accompanying social measures for the 3,100 employees who will lose their jobs. Renault has promised to offer serious social support, but Mr de Virville refused to talk about possible cash sums.
The closure sends a shockwave through the Belgian automobile industry. Belgium has car assembly lines of five different companies (Ford, General Motors, Volkswagen, Volvo and Renault) which provide direct employment for 33,000 people. Belgium assembles more cars per capita (500) than any other country. However, the decisions regarding these plants are taken at the headquarters of the various principal companies and none of them are located in Belgium. The question is whether more Renault-like decisions are to be expected.