THE PARTY’S OVER
By Peter Hitchens
After the party, the new dawn breaks bleakly for Leyland today , a prospect of closing factories and vanishing jobs for the sake of efficiency and survival. Chairman Sir Michael Edwardes laid it hard on the line last night. On top of the 18,000 jobs already lost he forecast 25,000 to be axed in the next two years and 13 plants facing total or partial shutdown.
Sir Michael, speaking in a London showroom surrounded by the cars that too many people make and too few buy, put it like this: “We must streamline parts and slim down the number of people we employ ,including staflf levels which have grown over the past 10 years out of proportion to the volume actually acheived. If ever there has been a company that has projected ‘jam tomorrow’ it has been this one. This time round we cannot afford to back losers in the hope that they will turn out to be winners.”
Sir Michael made his announcement only minutes after shocked union leaders were told, with a promise of consultation. He said he would back those workforces that performed well and warned: “Any plants which are not modern or being modernised or perform badly will be phased out.”
As he was speaking many of Leylands plants, total payroll 165,000, were shut down by another 48 hour engineers strike at a total cost of £20 million, equalling the groups half year profits. One factory that carried on working was Cowley , Oxford , ”because the staff demanded it and this is one of the plants which will be modernised and given more work. So will the one at Speke, Liverpool”
“because of the excellent co-operation of the work force and improved productivity since the other Speke plant closed last year.”
The new policy will be to ” back success”
It means that car productlon will stop at the MG works in Abmgdon, Oxford, and be switched to Cowley , though last night the MG Owners’ Club came up with an offer of up to £500,000 a year to keep the name going. Canley, Coventry, will also end car production, with the Japanese Honda line being switched to Cowley.
Speke will lose car-bodies but keep its press shop. Around Birmingham parts of plants at Castle Bromwich and Tile Hill will be closed as will a foundry at Tiptonand the Coseley engineering operation. A foundry in Leeds will be hit and a plan for a new aluminium foundry cancelled. But Jaguar production will continue in Coventry and Rover production at Solihull. And some work lost elsewhere will be switched to the huge plant at Longbridge as well as to Cowley. Leyland cars chief Mr Ray Horrocks said he hoped to produce five new models each year between 1980 and 1984.
First direct casualty is the Park Royal bus factory in North London. Leyland said it was producing only two buses a week instead of the present target of seven and planned 14. Leyland Vehicles chief Mr David Abell said: “This is a tragedy but the work force has refused to accept productivity standards which were reasonable. We must restrict support to areas which are prepared to support our exciting programme. All our manufacturing sites are under review. We need more vehicles and a lot less people. We can only achieve this with the complete co-operation of our employees.”
Sir Michael Edwardes blamed the position on three factor , the energy crisis upsetting economic forecasts, Leyland’s failure to reach its target in the home market, and the rising pound hitting exports. In the first six months of this year smooth production helped the company push profits from £17 million to £20 million from sales of £1,021 million. But that level of profit “is clearly inadequate,” said Sir Michael. And the outlook for the whole year is worse. The new plan should produce 950,000 vehicles a year and save £100 million but will require more than the £1,000 million funding at present under consideration. Sir Leslie Murphy, chairman of the National Enterprise Board, the State’s major shareholder in Leyland said: “Action must be taken.”
Engineering Union president Mr Terry Duffy , the man behind the two-day strikes in industry , said: “These are very grave proposals.”
The Transport Union’s Midlands chief, Mr Brian Mathers, called it “a black day”. In the end one in four of the old work force will have gone, he said. And Longbridge shop stewards’ chief Mr Derek Robinson said it would mean strikes. Both the engineers and the Transport Union are pledged to fight compulsory redundancies – which Leyland industrial relations chief Mr Pat Lowry made, clear would be inevitable in some places.