Belgium: Car industry in crisis

Nationalise and provide transport for all!

Slightly adapted translation of article printed in the monthly paper of LSP/PSL (CWI in Belgium)

Car industry in crisis

Growing flexibility and rising productivity in the car industry led to a situation of overproduction, even before the start of the present economic crisis. With the drastic fall in sales following the economic and financial crisis, we now see the consequences of capitalism’s race for profit. The prospect of bankruptcy for one of the big car companies becomes more realistic. Some neo-liberal analysts even find such a bankruptcy “necessary”.

According to Peter Leyman, a former CEO of Volvo-Gent, who for a short period participated in politics as an MP for the Christian-democratic CD&V, one of the three US car giants should lay down its books. That would be necessary to avoid “lost money” being pumped into the economy. “The backside of a bankruptcy is disastrous: social carnage and further detoriation of the financial markets”, according to Leyman. He added that this, though negative, might be the only realistic perspective.

The capitalists are not worried about the social bloodbath caused by their crisis. The uncertain situation in General Motors today is holding thousands of Opel-workers in Europe hostage. The possible closure of Opel-Antwerp, a rumour that has been spread for several months, would be disastrous for its 2,700 workers and thousands more, who work for its subcontractors. A closure would deprive 10,000 workers and their families of income at a time when it’s difficult to find a new job.

The bosses’ favourite tune of “high wage costs” is not the central problem in the car industry. Even Flemish minister, Van Mechelen (of the liberal VLD), indirectly admitted this in the daily De Standaard: “Today, a worker in Opel Antwerp is cheaper and more productive than his German colleague”. He added: “The differences with wages at the Opel factory in Slovenia are not that gigantic any more. In Slovenia wages are increasing by 10% a year, so in two or three years Antwerp will be at the same level.” The downward spiral is bringing Eastern European wages and living conditions to the West. This shows how the bosses’ arguments about wages are false.


The real problem facing the car industry is overproduction. In 2008, the four biggest car companies in Belgium (Ford Genk, Volvo Gent, Opel Antwerp and Audi Brussels) had 15,100 workers, 10% less than a year before. Since 2000, production has dropped by 30% and the number of workers by 50%. Productive capacity has been higher than sales figures and the gap is continuing to increase. In the production of trucks, the problem of overproduction is even greater. DAF Trucks in Westerlo announced the sacking of 873 workers. Production dropped from 245 trucks a day to 100. Less then half of those are actually sold.

A further attack on wages and working conditions will not save any jobs in the car industry. Neither would it end overproduction. The workers and unions should therefore not accept attacks on their wages and working conditions.

GM Europe’s boss, Carl-Peter Forster, is asking for loans of $4.2 billion from European governments, mainly from the German government. Using public funds to organise a massive round of layoffs from amongst the 55,000 European GM-workers is a scandal. Why not use public funds to save jobs and organise useful production? Professor economy Paul De Grauwe wrote in a column: “Those that hope to keep jobs in the Flemish car assembly sector are either dreamers or living on a different planet.”

Nationalise to develop alternative transport

The plans of different countries and regional governments to defend their native industry will not solve the problem of overproduction either. The Flemish ‘socialist’ metal union (the only industrial union in Belgium which is split into Flemish and Frenchspeaking sections) is wrong in its defensive approach, as described in the union’s paper: “All for themselves, we for Flanders”. Putting Opel under control of the European Union, as far as this would be possible, is also no answer. The EU is not exactly known as a social institution, but rather is a vehicle for neoliberal policies of attacking working conditions and all social gains of the past.

You don’t have to live “on a different planet” to know that in a few years there still will be a need of transport. We defend the need to nationalise the whole car industry. Not to socialise the losses and then re-privatise the profits after a social bloodbath. The knowledge and possibilities that are present in the car industry should be used to develop safe and ecological transport. The fight for jobs has to be linked to a discussion on how to organise mobility.

Nationalisation should be used to shorten the working week without a loss of pay. The extreme working conditions and pressure currently on car workers should be brought back to human proportions. We need workers and means to develop research and development of alternative forms of transport with a bigger emphasis on public transport.

Overproduction today will not stimulate research in alternatives. Why look for new ways to produce cars if the ones being produced now are not sold? The only “solution” in the capitalists’ view is to attack workers and their families to make them pay for a crisis not of their making. We shouldn’t leave nationalised industry under the control of those bosses and their political puppets who are responsible for the capitalist crisis. Nationalisation needs to be on the basis of workers’ control and management, to save jobs and to develop solutions for transport.

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March 2009