Chris Harman

Car industry

Protect jobs at Chrysler

(September 1978)

From Socialist Review, No.5, September 1978, pp.2-4.
Transcribed & marked up by Einde O’Callaghan for the Marxists’ Internet Archive.

Much of the comment by the British left on the takeover of Chrysler-Europe by Peugeot-Citroen has naturally focussed on the ‘multinational’ aspect of it. The job of thousands of workers in Coventry and Glasgow depend upon the outcome of a secret deal between Detroit and Paris.

The ‘planning agreements’ and ‘participation’ schemes that management, union officials and convenors claimed will guarantee jobs, have proved to be worthless because they in no way control the machinations of international big business.

At one level the argument is harmless enough. It gets across in a very direct way the futility of class collaboration, the unbridgeable gap that separates those who make decisions from those who suffer from them.

But there is a conclusion that is often drawn from this argument – by much of the’ ‘broad left’ – that is very dangerous. They argue that the way to deal with such ‘multinational’ machinations is to urge bodies like the Natural Enterprise Board to intervene, to build up a national car industry to fight the multinationals. On this basis, it is claimed, an ‘alternative economic policy’ can be developed to protect jobs and conditions.

But the case of Peugeot-Citroen does nof justify this conclusion. Because what is involved is not just a ‘multinational’ operation, but above all an attempt by French big business and government circles – to protect a ‘national’ car industry against the already existing multinationals.

A dozen years ago its seemed that the French car firms were going to fall, one by one, into the embrace of more powerful foreign concerns. All of de Gaulle’s nationalist rhetoric could not prevent Chrysler’s absorption of Simca, or the buying by the Italian giant FIAT of a powerful minority holding in Citroen.

It seemed that the time could not be far off where the pattern in France would be similar to that in Britain, with a solitary all-French (nationalised) company, Renault, surrounded by branches of foreign-based multinationals.

But measures were taken to obstruct the trend. State funds were already being used to maintain the expansion of Renault, regardless of considerations of mere profitability. So in the ‘70s, while car output in Germany stagnated, and declined in Britain and Italy, it rose steadily in France. Ten years ago French and British car output were roughly the same: today French output is double British.

Bailed out

Then the merger of Citroen and FIAT collapsed. During the oil crisis of 1973-4, Citroen faced very much the same problems as British Leyland. It was bailed out, by the French state on the one hand and the aggressively private capitalist Peugeot family on the other. A merger with Peugeot was masterminded by a new recruit to Peugeot’s top management, a top civil servant who had previously been a government nominee to the board of Renault; it was lubricated by a £115 million government loan.

The merged company was highly successful in the French market, surging well ahead of Chrysler-Simca and just overtaking Renault. By European standards it was a big company – nearly on a par with Volkswagen and Ford Europe and with twice the output of British Leyland. But that left its scale of operations well down in the Second Division when contrasted with the world-wide output of the American and Japanese firms.

Above all it lacked the penumbra of overseas subsidiaries which make it so easy for the US firms to gobble up foreign markets.

The takeover of Chrysler Europe provides the final, crowning glory for French capital’s car dreams. At a stroke it will have broken through on several fronts. The absorption of Chrysler-France into the French company will mean that American capital no longer has any foothold at all in French car production.

The French firm will gain production facilities in Britain, and will push itself into second place, behind SEAT, in Spain. This in addition to Peugeot-Citroen’s existing plans to produce cars in Rumania and transmissions in East Germany, its supply of knocked down parts to Iran, and its 15% stake in Mitsubushi. Its agreement with Chrysler US provides it with easier access to the US market. And, above all, the firm emerges as the only one in Europe comparable in size with the American and Japanese giants. Effectively, French capital has warded off the threat from foreign based multinationals by building up a French based multinational.

The story may not end with the merger. Despite the apparent incompatibility of the nationalised Renault and the staunchly private Peugeot collaboration exists between them. After all, Peugeot and Renault have had an agreement for sharing components for ten years: according to the Sunday Times ‘their most vigorously competing models share the same engines, gear boxes and transmissions’.

In any case the ramifications for the other car firms in Europe will be immense. Motor production is an industry where increased size means increased competitiveness.

As the Financial Times noted earlier this year:

‘The battle (for car markets) has been going unmistakeably to the big battalions in recent years. If the trend continues, and the bigger battalions grow even bigger as they grow multinational, what place will that leave for the smaller competitiors?’

Even Ford have been shaken from complacency by the implications of the merger. As they told the press the day it was announced, ‘We were number one in Europe this morning. If this deal comes off we shall be swamped’.

Conditions are going to be very difficult for many of the much smaller fry which in Britain means, above all, British Leyland. Its output is barely a third of that of Peugeot-Citroen-Chrysler Europe. The new giant will be half as big as the entire British car industry!

However much Leyland workers accept ‘participation’ arrangements and unite with their management to raise productivity, they are likely to be in a losing race.

It only remains to be added that the coup pulled off by French capital is of no tangible benefit to the workers in the French car factories or their new British subsidiaries.

Peugeot has been able to push itself to the top of the European car industry because it has been completely untrammelled by trade union resistance to low wages and bad working conditions. According to the Sunday Telegraph a recent survey of French industry showed that

‘Peugot demands the longest working week (42½ hours) and pays the lowest minimum monthly wage (£254) ... It is least generous in its payment of wages during sickness and comes a close second to the state Renault company on its accident record’.

Fewer than 10 per cent of Peugeot’s workers are unionised. Citroen and Simca have been the other two great centres of non-unionism in France, with contingents of security guards ready to beat up organisers from either of France main union federations, the CGT and the CFDT. Not surprisingly, both union federations were distinctly unhappy about a merger which means domination of the European car industry by an anti-union employer.

Like the so many other ‘rescues’, the rescue of Citroen by Peugeot four years ago means a considerable loss of jobs: from 64,000 Citroen jobs then to 52,000 now. Although the full range of Citroen and Peugeot models was maintained, they were increasingly made out a single set of components., so allowing a continual cutback in the number of workers.


Presumably a similar approach will be applied with the latest merger. A certain lapse of time – a year or more perhaps – will be allowed to avoid any immediate, politically embarrassing confrontations. And thin a full blooded rationalisation of the group’s operations will be pushed through.

This would probably leave certain assembly and storage facilities in the Spanish and British factories. But in all likelihood, when it comes to the manufacture of engines and components, the unionised British and Spanish workforces will be told that the precondition for keeping these will be ‘voluntary’ acceptance of conditions and wages as bad as those enforced by crude repression in the French factories.

All these are part of the cost which workers are having to pay for the defence of French capitalism’s car industry against its American and Japanese rivals – for ‘an alternative economic policy’ designed to protect ‘French national interests’.


If the supporters of a ‘British alternative economic policy’ want to resist the French and the Americans they will have to demand even more vicious attacks on British workers, since, the British car industry is so much smaller now even than the French.

But then talk of ‘alternative economic policies’ has nothing to do with socialism. It is talk of how, through state intervention, a particular national capitalism can stand up to the multinationals run by some other national capitalism. Our starting point has to be quite different – from the defence of workers jobs and conditions, against all capitalisms, national, multinational or ‘foreign’.

Our call for nationalisation under workers control, is a call for state intervention to protect jobs and conditions against the increasingly chaotic effects of national and international competition; not a call for a more efficient ‘national’ intervention in that competition.

A Dirty Word

‘How will the Peugeot family, so successful at excluding trade unions from their business in France, come to grips with having to negotiate with British trade unions?’ asked the Economist on 19 August. Not too well, if Peugeot’s record over the last ten years (at least) is maintained.

It was after all just ten years ago that the only worker actually shot down during the May/June events of 1968 was murdered – on a picket line at Peugeot’s Sochaux factory. Jacques Beylot was killed by riot police called in by Peugeot management.

And the company’s track record since then is not much better ... seven workers sacked in a lockout in March 1969 .... union militants harassed ... the fake union – CSL – boosted at the expense of genuine unions (France’s two main unions have only about 10-15 percent membership on the Peugeot shop floor) ... ballot forms for workplace elections defaced or fiddled in March 1971 etc.

Citroen’s record is if anything worse. Company union .... frame-ups of shop delegates. Late in 1971 at the Javel factory in Paris for example the company tried to rig elections so that only delegates of individual skilled groups would be accepted.

In June 1972 at the St Ouen plant Citroen resorted to the tactic of calling immigrant workers in one by one and demanding where their CFT (company union) card was: no card, no contract of employment ... Such practices mark the history of the growth of Peugeot-Citroen into what, with the addition of Chrysler, will be Europe’s largest car manufacturer.

Militants at the Sochaux plant have recalled how time and again the company resorts to provocation, uses security guards with telephoto lens cameras to identify individuals on a picket line or in an occupation, then sacks and blacklists those concerned.

The company is especially renowned for employing armed thugs as security men – even in France where private armies are considered quite normal ...

Last updated on 7 March 2010