By Barry Devney
NEARLY 5,000 jobs are to be axed by the Rover Group. Yesterday’s announcement of losses angered union leaders, coming only days after the final “yes” for British Aerospace’s take over of the car giant. Car assembly at the Cowley South, Oxford, works will be phased out between now and the early 1990s, hitting around 4,000 jobs.
The plant produces Montegos and Maestros. Rover is to concentrate production of small and medium range cars at Longbridge, Birmingham. Once the switch has been made, only executive saloons will be made in Oxford a n d they will roll off the lines of the Cowley North factory. It was also announced yesterday that the Llanelli pressings factory would close in 1990 with the loss of 900 jobs. Paul Talbot, national officer of the Manufacturing, Science and Finance Union, which has 7,000 members in Rover plants, was “very angry.”
He said it was clear the Trade Department, Rover and British Aerospace had known about the closure plan for months. Mr Talbot complained: “The only people who have not been aware of it are the employees of the company.”
Labour’s shadow industry spokesman Bryan Gould stormed: “Now we know the reason for the mystery 24-hour delay before British Aerospace agreed to buy Rover. The reality proves to be that they were seeking permission to start asset stripping.”
He added: “The news that the first act of the new owners will be to close two plants and throw a skilled and efficient workforce on the scrapheap is disastrous for the industry.”
At a tense meeting with union leaders Rover chief Graham Day acknowledged that efficiency and productivity had improved in recent years. But he insisted the company’s a overall performance was severely affected by ” significant over capacity ” in some areas. Llanelli was shocked by its closure. One angry worker said “Some people who lose their jobs here will just never work again. It’s as simple as that.”
The local council was trying to arrange a meeting with Rover in a bid to save the plant. Council Chief Executive Alan Bowen- Thomas said: ” This will have a shattering effect on the community. It ‘s 900 paypackets disappearing from 900 households.”
Rover Stuns Unions With 4900 Job Losses
The Rover Group is to close two of its plants in a drastic slimming down operation involving the loss of 4900 jobs. The move, which took union leaders by surprise, appears to set the company on the road to becoming a specialist producer concentrating on fewer models.
Car assembly at Oxford’s Cowley South works, where Montegos and Maestros are built, is to be phased out between now and the early 1990s. The Llanelli pressings factory, which makes plastic mouldings for a range of models, is to shut in two years. News of the closures was broken to the unions by Rover chairman Mr Graham Day at a meeting in London.
He said the company – whose total share of the UK market has slipped in recent years – was suffering from over-capacity. The announcement, which comes only days after British Aerospace confirmed its takeover plans for the group, brought a swift and angry response from union leaders and Labour MPs.
Llanelli faces 900 job losses when male unemployment in the town is running at 16%, and at Cowley, where 4000 jobs are to go, the number of Rover workers there will be reduced to 6000. Britain’s main car union condemned the closures as a “cynical betrayal of thousands of workers and their families.”
The Transport and General Workers added: “At a time when car sales are booming, it is little short of criminal to be reducing Britain’s capacity to compete with foreign imports.”
Transport Union convener at the Cowley assembly plant, Mr Ivor Braggins, said: “Over the last three or four years we have overturned the historic bad industrial relations situation at Cowley and this is all the thanks we get.”
In Llanelli, Transport Union officer Mr Brian Johnson said: “The spin-off effects on the town’s employment will be absolutely appalling because so many other firms depend on the plant for trade. We were afraid the British Aerospace takeover would mean something like this and there had been rumours of cuts. But no-one could have guessed the axe would fall within just a few days.”
The plants TGWU shop steward said the 900 employees – who start their summer holidays on Thursday – were in a state of shock.
Added Mr Ken Owens: “The first anyone knew of this when it was on the lunchtime radio news. We were not called in to be told until more than an hour later. It’s diabolical.”
The staff union MSF, which represents 7000 of Rover’s 44,000 workforce, accused the company, the government and British Aerospace of keeping unions in the dark about the redundancy plans. Yesterday’s move was not wholly unexpected. Last week there was much speculation that the £150 million BAE takeover deal would involve cutting capacity and shedding jobs.
BAE management would have known in advance of the Cowley and Llanelli announcement. But it is understood the decision would have been taken solely by Mr Day and the Rover Group. The move is all part of the Rover corporate plan – a plan which Bae and the EC have seen, but which Rover will implement solely until the takeover is completed.
My black financial figures, by the Rover chief
By Andrew Cornelius Industrial Correspondent
Mr Graham Day, Rover’s 54-year-old chairman, relaxed on a sofa at his company’s head office in London yesterday afternoon. “I’m just the latest of a long list of guys who have tried to do something with this business,” he said.
“There were a queue of people before me who tinkered. As far as I am concerned, no one else has produced black [financial] numbers here since a long way off.” Mr Day said, however, that people would have to wait ” four or five years” to see how the company’s new models developed “and the final position won’t be known for a decade.
“In 1971 BMW had one lousy car and one lousy engine. Look where they are now. They didn’t just do it in five years, or even in 10 years. It took longer than that.” Rover’s chairman recalled that people had said that the Cammell Laird shipyard would never survive when he ran it in the 1970s.
“Cammell Laird survived and I believe Rover will survive.”
Employees who lost their jobs at Llanelli, Dyfed, or Cowley, Oxford, could apply for jobs elsewhere at Rover “but our experience shows that this will not happen”. Unemployment in Oxford was only 3.5 per cent and 80 workers a month were leaving the Cowley factory in any case. At Llanelli, where unemployment is much higher, Rover would work with the Welsh Development Agency to help find new jobs, Mr Day promised. Mr Day sees Rover becoming a “semi-autonomous” subsidiary of British Aerospace, producing about 500,000 distinctive cars in the small, medium and executive sectors.
Rover was investing £160 million in the new R8 car, which will fit between the existing Maestro and the Rover 200 series next year and £150 million in the new *K’ series engine. Small and medium cars will be made at Longbridge West Midlands, and executive cars at Cowley. The Mini would not be axed until people stopped buying it or markets were unable to accept it for technical reasons. Assembly lines for the Maestro and Montego could easily be moved from the Cowley South works when it closes, if this fitted the model development programme, Mr Day said.
Suggestions that the Land-Rover factory at Solihull, West Midlands, would be closed so that production could be switched to Cowley were described by Mr Day as “patently ridiculous”. Mr Day said that yesterday’s news would have been much worse for the workforce if Rover had been taken over by a rival car company, rather than British Aerospace.
“There were a whole range of options and most were worse than this.”
Another car company would have rationalised engine production, products and distribution, which would have meant far heavier job losses. Rover would make a contribution to BAe’s earnings per share from day one, Mr Day said, though synergy from the merger would not begin flowing through for a few years. The two groups would probably explore the benefits of joining together by setting up joint projects under the leadership of Warwick University to explore the use of new materials. The immediate priority would be to establish coordinated financial systems and cash management.
ASSEMBLY WORKERS AT COWLEY ANGRY AT BEING LAST TO KNOW OF COMPANY’S CLOSURE PLANS
By Philip Hart and Tony Heath
Assembly line workers on the nine-hour day shift at Cowley’s South works only learned of the closure plan from a lunchtime radio bulletin. Letters explaining redundancy arrangements were not handed out by management until later in the afternoon.
“It’ s disgraceful. We’re the last people to hear anything, as usual,” said Mr Mark Roberts, aged 19, a radiator fitter on the Montego. His colleague, Mr Doug Fraser added: “We were told nothing by the bosses. We should have known about these plans ages ago. I take a very dim view of it all.”
It is a particularly bitter blow for Mr Roberts. He left the dole queues in Plymouth two years ago for what he believed was a “guaranteed job”.
“They never mentioned jobs were on the line when I came up here. I don’t know what I’ll do now, but I’m the only one in the family who works and I have a wife and two young children,” he said. Martin Sheehy said: “I don’t know what I’ll tell the wife when I get home, but I’ve got a big mortgage and at a time like this, that’s not good news.”
One woman, who did not want to be identified, was married only this month. The news that her job is to go coincided with the start of her honeymoon. She said: “We’ve been expecting this, but if’s still a real surprise”.
Shock waves will be felt throughout Oxfordshire. Hundreds of workers travel into the Rover plant from neighbouring towns each day. The chairman of the Cowley community centre, Mr Brian Berry, predicted: “It is the shops and businesses here that are going to bear the brunt of this~ There’s always been money from the works spent in Cowley, so the loss of 4,000 jobs is bound to hit us.”
He has been employed in the North works for 31 years. “We’ve just got to hope this is not a sign of things to come for the whole site.”
Mr Ivor Braggins, the Transport and General Workers Union convenor on the site, said: “The company spread rumours to condition people to expect this news. But it still hasn’t sunk in for a lot of people – their true response will come in a couple of days time when they’ve had a chance to reflect oh this. My initial reaction is one of bitterness.
Over the last two years we have turned the corner in terms of efficiency and industrial relations and this is what we get to show for it. It is scant reward for the progress we’ve made. It is a kick in the teeth for the whole Cowley operation and we will be meeting management to find out what the position is with regard to the North works. They are only working 28 per cent of capacity on producing the Rover 800, so there must be the pr ospect of total closure”.
In Llanelli, the chief executive of the borough, Mr Alun Bowen Thomas, described the proposed closure as shattering. “Removing 900 pay packets from a town of 25,000 people is devastating,” he said. Unemployment had been cut back slowly from 21.9 per cent in 1980 to 14.2 per cent.
“It will go screaming back up by 1990. There is simply no alternative. ”
The Welsh Secretary, Mr Peter Walker, hopes regional policy will help redundant workers find other jobs â€” a sentiment which cut little ice in the town last night. The MP for Llanelli, Mr Denzil Davies, said he was appalled and was seeking an urgent meeting with Mr Walker and the Rover chairman Mr Graham Day.