UK car industry trouble ahead..?
Discussion
http://www.telegraph.co.uk/business/2017/02/18/fre...
So unions threatening strikes at Mini and RR over pensions (they're trying to diddle them out of their final salary pensions) and Vauxhall/Opel in ropey position having made $10bn in losses over the past decade and haven't clocked a profit since 2009. PSA Groupe (Peugeot/Citroen) are looking at taking them off GM's hands and there is worry of jobs being lost (and I suppose a continually failing entity means jobs were somehow safe?)
As an aside, I always thought Peugeot/Citroen were just as dire financially, but it seem their CEO Carlos Tavares has steered the ship pretty well since he took over and they're in much better shape than they were. Wondering what he would do to turn Opel's fortunes around? They don't seem to make bad cars.... they just seem so inconsequential and irrelevant.
The pensions row sounds bad. Of course, if I had a final salary pension, I wouldn't want to give it up. But plainly these things must simply be unaffordable. Many places no longer offer them and haven't for ages and there have been similar attempts to remove them in the past. It can't just be a sly money grab but legitimately bad for the bottom line and ultimately the existence of the company(?)
So unions threatening strikes at Mini and RR over pensions (they're trying to diddle them out of their final salary pensions) and Vauxhall/Opel in ropey position having made $10bn in losses over the past decade and haven't clocked a profit since 2009. PSA Groupe (Peugeot/Citroen) are looking at taking them off GM's hands and there is worry of jobs being lost (and I suppose a continually failing entity means jobs were somehow safe?)
As an aside, I always thought Peugeot/Citroen were just as dire financially, but it seem their CEO Carlos Tavares has steered the ship pretty well since he took over and they're in much better shape than they were. Wondering what he would do to turn Opel's fortunes around? They don't seem to make bad cars.... they just seem so inconsequential and irrelevant.
The pensions row sounds bad. Of course, if I had a final salary pension, I wouldn't want to give it up. But plainly these things must simply be unaffordable. Many places no longer offer them and haven't for ages and there have been similar attempts to remove them in the past. It can't just be a sly money grab but legitimately bad for the bottom line and ultimately the existence of the company(?)
Pensions are biting - there is no hope in hell that a company can keep a final salary pension going, slowly companies are ending them or at least changing the structure in such a way that the salary element doesn't increase by much each year, I know mt RBS final salary pension was getting pretty crap - if I had a 5% wage rise one year the rise on the pension was limited to around 0.25% or something stupid like that. these things are getting bad and a lot of workers are going against what is happening, they are being short changed.
lot of unrest will kick off over the next few years.
lot of unrest will kick off over the next few years.
UK vehicle production peaked around 12% worldwide market share in 1963 and has been sliding ever since, to around 2% in 2016... The Vauxhall plants will close next year, pour thousands of skilled jobseekers into the supply chain, and shrink the industry by about £1-2 billion... Electric cars (30-80% fewer parts), robots and AI will will reduce the human workforce for vehicle manufacturing by perhaps 20-50% in the next 15-30 years... Vehicle workers are not at all in a strong position to be bargaining on pensions.
What will stick in the craw is, the German workers of said car companies will not be taking anywhere near the hit the UK workers will...
What will stick in the craw is, the German workers of said car companies will not be taking anywhere near the hit the UK workers will...
Yipper said:
UK vehicle production peaked around 12% worldwide market share in 1963 and has been sliding ever since, to around 2% in 2016... The Vauxhall plants will close next year, pour thousands of skilled jobseekers into the supply chain, and shrink the industry by about £1-2 billion... Electric cars (30-80% fewer parts), robots and AI will will reduce the human workforce for vehicle manufacturing by perhaps 20-50% in the next 15-30 years... Vehicle workers are not at all in a strong position to be bargaining on pensions.
What will stick in the craw is, the German workers of said car companies will not be taking anywhere near the hit the UK workers will...
Stalin said "no people no problems"What will stick in the craw is, the German workers of said car companies will not be taking anywhere near the hit the UK workers will...
Someone uncle said " lets see that robot buying a car"
Germany is not run by idiots, they actually know what they are doing
Fake news
Snowflakes
I really dont want a hard brexit, as i think it will plunge us back to the heights of errr.... the 1970s
GM just never moved with the times, on the news last night there was a short video of one of their production lines, it looked like BL in the 70s,
quite a few years ago I was chatting to a manager of the engine plant at Honda, he had just taken round a new starter, he had previously worked at Vauxhall, at the end of the tour the guy asked where the engines were tested, he struggled with the concept that the engines were not run up and that they would just work every time, hopefully things have moved on from then but I suspect not.
My suspicion is that PSA will just shut down the UK operation, this will take out some of the competition.
quite a few years ago I was chatting to a manager of the engine plant at Honda, he had just taken round a new starter, he had previously worked at Vauxhall, at the end of the tour the guy asked where the engines were tested, he struggled with the concept that the engines were not run up and that they would just work every time, hopefully things have moved on from then but I suspect not.
My suspicion is that PSA will just shut down the UK operation, this will take out some of the competition.
We are a big market for cars , will people buy PSA cars if they are suddenly 10% more expensive because they are made in France and not britain , there is also the Austrliasian market Holden is packing up so
a free trade agreement with Australia might make the UK a very attractive place for car makers who serve that market ??
a free trade agreement with Australia might make the UK a very attractive place for car makers who serve that market ??
Yipper said:
UK vehicle production peaked around 12% worldwide market share in 1963 and has been sliding ever since, to around 2% in 2016... The Vauxhall plants will close next year, pour thousands of skilled jobseekers into the supply chain, and shrink the industry by about £1-2 billion... Electric cars (30-80% fewer parts), robots and AI will will reduce the human workforce for vehicle manufacturing by perhaps 20-50% in the next 15-30 years... Vehicle workers are not at all in a strong position to be bargaining on pensions.
What will stick in the craw is, the German workers of said car companies will not be taking anywhere near the hit the UK workers will...
Any replacement by robots has already happend. I can walk around a BIW dept and not see a human where it would have been filled with people 10 years ago. Where we still have people are generally operations that thanks to the massive influx of East European workers, we can get done by a person so cheaply that a robot isn't economical, or applications (and they are still more common than you might think) where a level of craftsmanship or judgement is required.What will stick in the craw is, the German workers of said car companies will not be taking anywhere near the hit the UK workers will...
In terms of the German worker getting a better deal, it works both ways. A past boss of mine put a proposition in to move my dept to Germany (it can be done by any site really as it was 90% travel to suppliers) and it was rejected and kept in the UK as the German option was several millions more per year, largely due to the wage/pension differential for people of the same level...so that's 50 jobs denied Germany and kept in the UK.
Liokault said:
Yipper said:
UK vehicle production peaked around 12% worldwide market share in 1963 and has been sliding ever since, to around 2% in 2016... The Vauxhall plants will close next year, pour thousands of skilled jobseekers into the supply chain, and shrink the industry by about £1-2 billion... Electric cars (30-80% fewer parts), robots and AI will will reduce the human workforce for vehicle manufacturing by perhaps 20-50% in the next 15-30 years... Vehicle workers are not at all in a strong position to be bargaining on pensions.
What will stick in the craw is, the German workers of said car companies will not be taking anywhere near the hit the UK workers will...
Any replacement by robots has already happend. I can walk around a BIW dept and not see a human where it would have been filled with people 10 years ago. Where we still have people are generally operations that thanks to the massive influx of East European workers, we can get done by a person so cheaply that a robot isn't economical, or applications (and they are still more common than you might think) where a level of craftsmanship or judgement is required.What will stick in the craw is, the German workers of said car companies will not be taking anywhere near the hit the UK workers will...
In terms of the German worker getting a better deal, it works both ways. A past boss of mine put a proposition in to move my dept to Germany (it can be done by any site really as it was 90% travel to suppliers) and it was rejected and kept in the UK as the German option was several millions more per year, largely due to the wage/pension differential for people of the same level...so that's 50 jobs denied Germany and kept in the UK.
Despite high entry and exit costs, the German car industry is 3-4 times bigger than the UK. And German workers get paid considerably more in pay, benefits and job security. The German car companies want to screw over low-value economies, like the UK or China, while paying their own staff fat wedges. Which is fair enough (all countries look after their own first). But it is easy to see why British workers get hacked off.
Yipper said:
UK vehicle production peaked around 12% worldwide market share in 1963 and has been sliding ever since, to around 2% in 2016... The Vauxhall plants will close next year, pour thousands of skilled jobseekers into the supply chain, and shrink the industry by about £1-2 billion... Electric cars (30-80% fewer parts), robots and AI will will reduce the human workforce for vehicle manufacturing by perhaps 20-50% in the next 15-30 years... Vehicle workers are not at all in a strong position to be bargaining on pensions.
What will stick in the craw is, the German workers of said car companies will not be taking anywhere near the hit the UK workers will...
Couple of days ago the media were crowing about how Brexit will deprive the country of a million skilled hands, just when we need them most, with an aging worker population......What will stick in the craw is, the German workers of said car companies will not be taking anywhere near the hit the UK workers will...
So, no problems for the redundant car workers, plenty of jobs for them, surely........
Yipper said:
Robots and AI will eventually replace the craft-workers and also the managers. Nobody, from the bottom to top, is safe. A financial hedge fund in New York, for example, is on track to replace 50% of its own CEO's role with an AI bot by 2020.
I wouldn't presume to say you're wrong but similar things were being said in the '70s and every decade since (not specifically AI bots, of course!)And the earlier comment about robots not buying cars also has an element of truth. Hedge funds alone do not an economy make.
Tryke3 said:
Stalin said "no people no problems"
Someone uncle said " lets see that robot buying a car"
Germany is not run by idiots, they actually know what they are doing
Fake news
Snowflakes
I really dont want a hard brexit, as i think it will plunge us back to the heights of errr.... the 1970s
What has this got too with the removal of unaffordable final salary pensions within an industry struggling to make money?Someone uncle said " lets see that robot buying a car"
Germany is not run by idiots, they actually know what they are doing
Fake news
Snowflakes
I really dont want a hard brexit, as i think it will plunge us back to the heights of errr.... the 1970s
REALIST123 said:
I wouldn't presume to say you're wrong but similar things were being said in the '70s and every decade since (not specifically AI bots, of course!)
Indeed. I can still recall having an Economics lesson at school where we looked at reports from whenever that predicted that because of nuclear power, electricity would cost so little to produce that it would be almost (if not completely) free. That wasn't the case 30 years ago and certainly not the case now.On the ITV late news (lat Thursday I think), the reporter said pretty much that Vauxhall (and specifically Ellesmere Port) did not really manufacture very much. So they ship in 70% of the parts from overseas, assemble them and then ship the cars back overseas. He started to say that therefore this is not a very good idea and so you can try and blame this situation on Brexit (because it's been like this for years) but somehow he never actually quite managed to finish what he was trying to say.
Tryke3 said:
...
I really dont want a hard brexit, as i think it will plunge us back to the heights of errr.... the 1970s
If we have UK car industry workers demanding unaffordable things that the vast majority gave up years ago, then it sounds like we are already back in the 70s in some sectors...I really dont want a hard brexit, as i think it will plunge us back to the heights of errr.... the 1970s
And that sort of thing is unlikely to help persuade companies to base themselves here...
fblm said:
Is anyone really being asked to 'give up their final salary pensions'? Are they really losing previously accrued entitlements or is the company just not prepared to pay for further accruals going forward?
Obviously, no-one has lost or will lose already-accrued pension rights, any more than they'd lose already earned salary. But as OP says, unnaffordable as they are, no-one who has one wants to see it end and be replaced with a lesser scheme. Unless their job depends on it, which we just saw with the Tata steel workers.snuffy said:
On the ITV late news (lat Thursday I think), the reporter said pretty much that Vauxhall (and specifically Ellesmere Port) did not really manufacture very much. So they ship in 70% of the parts from overseas, assemble them and then ship the cars back overseas. He started to say that therefore this is not a very good idea and so you can try and blame this situation on Brexit (because it's been like this for years) but somehow he never actually quite managed to finish what he was trying to say.
It's a long time since I worked in the car industry, but I do remember that all the factories I worked at ran on the 'just in time' principle, so components and sub assemblies turned up at the factory when they were due to be used. They held no real inventories of anything - it's too costly.Post Brexit, outside the single market and probably the customs union, any factory that works on a just in time principle and which imports 75% of its 'bits' from the EU is, I suspect, going to be in deep s
t. Unless somehow, TM gets a deal where customs delays can't and don't happen. I wouldn't hold my breath for that though.Vauxhall production in the UK has been living on borrowed time for years. I can easily see that if PSA buy the goods then they will close Vauxhall completely and rebrand everything as Opel taking the UK factories with it especially as with a "hard Brexit" those factories will be outside of the EU.
ou sont les biscuits said:
Post Brexit, outside the single market and probably the customs union, any factory that works on a just in time principle and which imports 75% of its 'bits' from the EU is, I suspect, going to be in deep st. Unless somehow, TM gets a deal where customs delays can't and don't happen. I wouldn't hold my breath for that though.
Either that or they will start buying things from the UK...not much is made in Europe that can't be had locally. Anything Unique tends to be from outside the EU anyway.t. Unless somehow, TM gets a deal where customs delays can't and don't happen. I wouldn't hold my breath for that though.I do this for a living, in the last few years I have sourced generic parts from EU, generally plastic mouldings and simple metal parts, but I have also sourced parts from Mexico, USA, Japan and South africa.
Brexit is just a huge opertunity for local suppliers.
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