When Renault chairman Louis Schweitzer announced his decision to close
a profitable auto plant in Belgium last month, he didn't expect to set
off the continent's first
Nor did he expect a rebuke from the King of Belgium, the president of France, the president of the European Commission, clergymen, and politicians of all persuasions, as well as a consumer boycott of French goods in Belgium, including Renault cars.
It's not the first time a loss-making European corporation has closed
a plant. But to European sensibilities, this announcement was
particularly abrupt and
brutal. The fallout now threatens
Renault's efforts to restructure its auto business, and has sharply
reopened a public debate on the future of Europe.
Renault's Feb. 27 announcement created a sensation in Belgium, where foreign carmakers are a key employer. Critics, including King Albert II, blasted Renault for failing to consult with workers before closing the Vilvorde plant, expected by July 31.
European Commission (EC) President Jacques Santer called the decision
a grave blow to the spirit of confidence in Europe and urged
workers to sue the company for violating European labor law. According
to two European directives, Renault should have discussed the plan
with workers and negotiated compensations before closing the plant.
The French government, which holds 46 percent of Renault stock, called
the Renault chairman on the carpet over the
method of the
announcement, but did not criticize the final decision. But key
politicians in the socialist opposition and the ruling conservative
coalition renewed calls over the weekend for a referendum on European
On Friday, Renault workers in Belgium, France, and Spain shut down
lines for an hour to protest the Vilvorde closing - the first time
that workers across Europe launched a strike against a single
employer. Ford, Volkswagen, General Motors, and Volvo workers also
shut down lines in Belgium in support of Vilvorde. Workers chanted the
We are all Belgian workers!
Two days after the Renault announcement, representatives of French,
Spanish, and Belgian unions met in Paris and approved a plan of
action, including Friday's strike.
This move was unprecedented
among European unions, says Karel Gacoms, head of the Vilvorde
It was the shock and brutality of this decision that set off a
spontaneous reaction, especially in France, where workers reasoned
that what's happening in Vilvorde could happen to us tomorrow. Even
Spanish workers, who stood to gain from the Vilvorde shutdown,
supported the strike, Tony Jamsson, president of European
Federation of Metalworkers, told the Monitor.
On the eve of the strike, managers at the Renault plant in Valladolid, Spain, distributed leaflets explaining that Spanish workers would gain work and job security from the Vilvorde closing.
Nonetheless, Valladolid joined other Renault factories on Friday in shutting down work for an hour each shift, and about half of Renault workers across Europe supported the shutdown.
In addition, the Spanish government withdrew a request for $12.5 million in state aid to Renault to modernize its Valladolid plant, after EC officials charged that Renault was taking advantage of European aid to shift production from Belgium to Spain.
A job with Renault used to be the next best thing to lifetime job security, and Vilvorde was one of the most productive Renault plants. Renault has had a plant in Vilvorde since 1926.
Renault is expected to announce losses of nearly $1 billion for 1996
this week, and spokesmen claim
drastic action was needed to
reverse this picture, including some 2,700 new layoffs in France.
Our strategy in the future will be to go outside Europe. We plan
to build a plant in Brazil by 1999, the spokesmen add.