From the US Socialist Appeal , paper of the Workers International League
While Ford workers in North America prepare to weather a new round
of plant closings and layoffs, their bosses in Detroit have unveiled
plans for new plants in China, a country with the world’s fastest
growing car market along with rock-bottom wages. Meanwhile, Russian
Ford workers have won an important victory not only against the company
but against the new, repressive Russian Labor Code.
The big
corporations in North America, Western Europe and Japan are moving more
of their factories abroad in search of lower wages. But in the process
they are tying the interests of the international working class more
closely together. In global companies like Ford, the interests of a
section of workers on almost every continent are directly linked. The
answer to capitalist globalization is to link up workers’ struggle
worldwide.
Ford
Motor Co. is one of the world’s largest auto companies. The company
owns more than 100 plants and employs 280,000 workers worldwide. In
2006, Ford produced 6.6 million vehicles, and controlled roughly 18
percent of the U.S. automobile market. It owns the Mercury, Lincoln,
Jaguar, Land Rover, and Volvo brands. It owns a one-third controlling
interest in Mazda, as well. Despite being one of the world’s largest
auto makers, over the past decade Ford has seen a steady drop in its
profitability. In 2006 alone Ford reported a net loss of $12 billion.
As always, it’s the workers that are being forced to pay for the
bosses’ problems with mass layoffs, wage and benefit cuts, worsening
conditions and harsher work rules.
To claw back towards
profitability by 2009, Ford has begun instituting “The Way Forward”
plan of “restructuring” (i.e. downsizing) its operations in North
America. Roughly half of Ford’s plants are in the U.S. and Canada. The
company has already mortgaged its U.S. plants for a $23.4 billion line
of credit. They want to use this money to pay for the restructuring
plan, which will close 16 plants by 2012. So far it has already named 6
plants that will be closed. The plan also calls for cutting 40 percent
of its total workforce in North America, and cutting its costs by $5
billion as compared to 2005.
In addition to “The Way Forward”
plan, Ford unloaded its health care costs onto the shoulders of the
United Auto Workers (UAW) union in September 2007. Through a VEBA
(Voluntary Employee Benefit Association) scheme, Ford workers are now
responsible for paying all of their health care costs while the company
is no longer obligated to pay. The figures for Ford workers’ health
care costs aren’t available, but to give an idea, the total amount that
GM was responsible for to its UAW workers in 2007 was $51 billion. In
the last round of contract negotiations with the “Big Three” – GM,
Ford and Chrysler – VEBAs were imposed on UAW workers in all three
companies.
Ford had an eager “partner” in this scheme: UAW
International President Ron Gettlefinger, who initially proposed the
VEBA plan to GM (and later Ford) before contract negotiations even
began last year. The UAW tops who pushed for the concessions basically
said: “Our health care costs are killing the company; if the company
can’t make money they’ll ship our plants overseas, so it’s better to
have a worse job than no job at all.” But no matter how many
concessions the UAW gives to Ford, the company considers a unionized
workforce a problem in itself.
UAW members produce 46 percent of
Ford’s cars and trucks by volume, and North America is still the
company’s main market. The UAW alone has the collective ability to shut
down almost half of the company’s total world production. Despite the
huge concessions the leadership has given to the company, Ford can’t
reap profits anymore unless it cuts “costs” to the bone. The bosses
would rather be rid of the UAW altogether, despite Gettlefinger’s
“partnership”, and be free to impose its conditions on auto workers at
will. One of the main reasons that Ford has been shifting more and more
production outside the U.S. has not just been to sell more cars abroad,
but also to weaken the UAW by building pressure for never-ending cuts.
Like
every other big corporation in the world, Ford has gone to China. The
car market in China has exploded in the past decade, and China is now
the world’s second largest market. To give an idea of how fast car
ownership is growing in China, McDonald’s Corp. recently announced that
half of its new locations in China will have drive-through windows. And
car ownership hasn’t yet even become as widespread as it is in most
industrialized countries today – there are about 25 vehicles (and less
than 7 cars) for every thousand people. This is about the same level
the U.S. had in 1915.
Auto manufacturing in China has grown
tremendously to keep up. The auto industry employs 1.7 million. In the
southwestern city of Chongqing, auto plants spread over more than 5,000
acres. The city’s factories made 600,000 cars in 2006, and city
officials want to double that by 2010.
According to the China
Daily, Ford’s China spokesman, Kenneth Hsu, said that the company is
“gauging the need for further expansion of our manufacturing capacity,”
and that “local governments [in China] are keen to have a new plant
from Ford in their regions.”
Ford, its Japanese subsidiary Mazda,
and privately owned China partner Chang’an Motor Corp. have created a
joint venture, Chang’an Ford Mazda Automobile Co., which owns two
plants in Chongqing and Nanjing. The new Nanjing plant is expected to
produce 50,000 to 80,000 cars in 2008, and move into peak production
mode in 2009, producing 160,000 cars when it reaches capacity.
Another
reason Ford is salivating over setting up plants in China are
rock-bottom wage levels. The average wage for an auto worker at Geely,
the biggest Chinese auto company, is only about $250 per month
($1.27/hour). Most workers are immigrants from the countryside, sending
most of their wages home and living in company dormitories. But moving
its factories outside the U.S. won’t solve all of Ford’s problems, as
was recently seen in Russia.
On
December 14th, thousands of mostly young workers at the ZAO Ford
factory in Vsevolozhsk, Russia returned to work after winning most of
their demands in a key strike. This was the first successful major
strike in Russia since the fall of the Soviet Union, and struck a blow
to the new, draconian Russian Labor Code, which makes strikes all but
impossible. Most importantly it showed not just Russian workers but
auto workers worldwide that it pays to fight.
The strike began on
November 20, and lasted three weeks. The workers’ demands reflected the
terrible conditions faced by Russian factory workers. The demands were:
a 35 percent wage increase (the average monthly wage of ZAO Ford
workers is $600-800), indexing wages to rapidly rising inflation,
overtime pay of three times the base rate, raises tied to seniority,
higher pensions, a reduction of the working day and regularization of
working hours. The workers also demanded a reduction of night shift
hours from seven and a half hours to six and a half hours.
When
the strike began, management quickly invoked the Russian Labor Code,
saying that workers would not be paid during the strike. The Ford
bosses also attempted to “divide and rule” by paying workers who voted
against the strike two-thirds of their wages during the strike. The
union’s response was a daily mass picket that at times had as many as
1,500 workers.
Throughout the strike the union faced constant
intimidation from the police, from physical harassment and violence to
the ever-present threat of prosecution. In the first week of the strike
a worker was hit by a police car. The workers maintained the strike,
however, and did not give in to the pressures of the Ford bosses or the
police. Management attempted to throw together a shift of office staff
to work the assembly lines, but only a trickle of cars were produced,
and most of these are undoubtedly junk as the quality control
department was shut down for the duration of the strike.
Day by
day the plant’s profit projections dropped as its reserve of cars to be
sold on the market dwindled. The Ford bosses tried shipping cars from
its plants and warehouses in Germany to make up for its lost
production, but this was stopped by solidarity action of German Ford
workers. Finally, management gave in and the Vsevolozhsk Ford workers
voted at a general meeting to end the strike on December 14th.
Ford
conceded to most of the workers’ demands, including indexing wages to
inflation, paying overtime and recognizing seniority with pay raises.
Perhaps the most important aspect was the fact that the company signed
an agreement prohibiting any punitive actions against those workers who
went on strike. Through collective strike action, and by refusing to
cower to capitalist “legality,” the Russian Ford workers took on the
Labor Code, which penalizes workers who strike with fines and possible
prison time.
From the beginning of the strike, the Ford workers
appealed to the international labor movement for solidarity, and to
other Ford workers in particular. This is a necessary first step in
linking up the class struggle in a worldwide company like Ford. The big
auto companies, like all the big corporations in North America, Western
Europe and Japan, want to increase their profits by abandoning highly
unionized plants in their “home” countries and setting up plants abroad
where they can squeeze even more out of the local working class.
But
the class struggle follows capitalism wherever it migrates. Capitalist
globalization makes it necessary for workers not only to build
solidarity on an international scale, but ultimately to coordinate
their struggle against the bosses internationally. Workers’
internationalism is the way forward!
