rover still heading for china
WORKERS, MAR 2005 ISSUE
The long-overdue wedding announcement of China's Shanghai Automotive Industry Corporation and MG Rover, heralded for late last year, still seems to be in a state of uncertainty, despite the Chinese bridegroom's reassuring announcements.
Meanwhile, a local newspaper in the Midlands has revealed that MG Rover has asked 119 workers to prepare to work in Shanghai in order to restructure operations at Longbridge, as well as to provide the necessary technical expertise for any project in China. If China gets access to the technological and research base of MG Rover, what value Longbridge?
There are also suggestions that the company is planning to shift some operations to low-cost bases such as India or South Africa as it attempts to save up to £100 million. It may be that Tony Woodley, General Secretary of the Transport and General Workers Union, is being overly optimistic if he believes that the deal is "the last possible lifeline that will keep this very British company alive and going".
In fact, the wider economic indicators are not looking good. China has announced that internal car sales in 2004 dropped by 15%, with indications that internal sales for 2005 will be 6-10% lower. So who needs further overcapacity in the vehicle manufacturing base? Nearly 60% of members of the Engineering Employers Federation recently indicated that they have shifted or intend to shift manufacturing to China. Why would MG Rover buck such a trend? The Chinese may have substituted Mah-Jong for Poker but the workers of Longbridge look as though they are the losers whatever the game.