{"id":3725,"date":"2019-02-12T07:48:05","date_gmt":"2019-02-12T13:48:05","guid":{"rendered":"http:\/\/planesintheair.com\/?p=3725"},"modified":"2019-02-12T08:30:38","modified_gmt":"2019-02-12T14:30:38","slug":"french-workers-after-macrons-alstom-dream-is-blocked","status":"publish","type":"post","link":"https:\/\/planesintheair.com\/?p=3725","title":{"rendered":"French Workers Cheer After Macron’s Alstom Dream is Blocked"},"content":{"rendered":"\n

By Richard Lough and Gilbert Reilhac<\/p>\n\n\n\n

BELFORT,\n France (Reuters) – After four decades on the production line at French \ntrainmaker Alstom, Claude Gemino had little sympathy for Emmanuel Macron\n when Brussels scotched the French president’s hopes of creating a \nEuropean rail champion.<\/p>\n\n\n\n

For\n Gemino and many co-workers at Alstom’s Belfort factory, Macron’s \nsupport for the blocked merger with Germany’s Siemens signalled a \nreadiness to put shareholders ahead of jobs and protecting France’s \nfragile manufacturing sector.<\/p>\n\n\n\n

But\n the European Commission’s veto last week has raised doubts about the \npresident’s industrial strategy as he battles to quell unrest over \ninequality and a perception he is indifferent to the struggles of \nFrance’s working class.<\/p>\n\n\n\n

The\n workers’ disdain for Macron’s industrial plan reflects a broader \nlower-class anger at the former investment banker’s reforms designed to \nliberalise and invigorate France’s heavily regulated economy.<\/p>\n\n\n\n

Violent\n “yellow vest” anti-government protests have convulsed France for the \npast three months and raised questions over whether the man dubbed the \n“president of the rich” by left-wingers can make France more \ncompetitive.<\/p>\n\n\n\n

“The\n order books are apparently pretty full. Management tells us we’re \ncovered for the next four or five years,” Gemino, who joined Alstom as a\n teenage apprentice, said as he passed through the plant’s turnstile. \n“The future isn’t so bleak.”<\/p>\n\n\n\n

Alstom\n and Siemens wanted to merge their train manufacturing businesses to \ncompete more effectively against China’s state-owned CRRC, the world’s \nbiggest trainmaker, at a time rail companies globally are looking to \nconsolidate and reduce costs through economies of scale.<\/p>\n\n\n\n

Alstom’s\n unions say the company, with booked orders of 40 billion euros ($45 \nbillion), is strong enough to survive alone and they would prefer to \ntake on China without German help.<\/p>\n\n\n\n

“There\n will always be a risk, but Alstom and Siemens are capable of looking \nafter themselves, on their own, and of pushing back against China,” said\n Olivier Kohler, an Alstom employee and member of the moderate CFDT \nunion, France’s largest.<\/p>\n\n\n\n

“Even if there was a merger, their prices would still be lower.”<\/p>\n\n\n\n

Asked\n if Alstom could compete globally alone, an official in Macron’s office \nsaid: “In the short term, yes. It’s making money. The problem is the \nlong term,” they said.<\/p>\n\n\n\n

SHORT-TERM WIN<\/p>\n\n\n\n

At\n the foot of Belfort’s imposing citadel stands a giant statue of a lion \ncarved out of red sandstone, symbolising the town’s resistance against \nGerman forces during the Franco-Prussian war of 1870.<\/p>\n\n\n\n

Nowadays,\n it’s Alstom’s fate in the face of foreign competition that weighs \nheavily on the collective psyche of Belfort, a town of 50,000 near \nGermany and Switzerland where the iconic high-speed TGV (Train a Grande \nVitesse) is made.<\/p>\n\n\n\n

“Alstom\n is part of the town’s identity,” said retired SNCF railworker Georges \nPagnoncelle. “But French industrial groups keep on being bought by \nforeign firms, and jobs keep disappearing from France.”<\/p>\n\n\n\n

Alstom’s\n unions were worried that a merger with Siemens would lead to the \nbleeding of jobs in France, but acknowledged the European Commission’s \nveto was only a short-term reprieve.<\/p>\n\n\n\n

The\n threat from China and trainmakers in other emerging economies such as \nSouth Korea will persist and future alliances cannot be ruled out. \nFrustrated by the rejection of the Siemens-Alstom deal, Paris and Berlin\n now want to loosen European competition rules to take a more global \nview.<\/p>\n\n\n\n

Unionised\n managers at Belfort said they understood why the French government \nmight want to merge Alstom with Siemens, but maintained that any such \nmove must be on a 50-50 footing, protect jobs and fit into a clearer \nlong-term strategy.<\/p>\n\n\n\n

Under\n the terms of the proposal, the German conglomerate would have taken a \nstake of 50 percent plus a few shares in Alstom with an undertaking not \nto boost its holding above 50.5 percent in the first four years.<\/p>\n\n\n\n

Alstom workers said Siemens would have been left in the driving seat.<\/p>\n\n\n\n

“We\n need a political vision for French industry,” said Andre Fages of the \nCFE-CGC union that represents management, stressing the need for \ninvestment in research and development. “Our politicians say France \nneeds a strong rail industry. But when they want to buy trains, they \nwant them at Chinese prices.”<\/p>\n\n\n\n

MACRON CONUNDRUM<\/p>\n\n\n\n

Alstom\n was Belfort’s biggest employer until 2014 when it sold its turbine \nmanufacturing business to U.S. company General Electric. Two years \nlater, the then-Socialist government threw a lifeline 630-million-euro \norder for TGVs it did not yet need to stop Alstom shutting down the \nBelfort production line.<\/p>\n\n\n\n

In\n a reflection of France’s industrial decline, Alstom’s TGV plant is now \nsurrounded by towering structures bearing General Electric’s logo. \nAcross a rail track stand rows of violet-shuttered terraced dwellings \nthat once housed Alstom workers.<\/p>\n\n\n\n

The\n town’s mayor, Damien Meslot, said the trainmaker now employed just 480 \nworkers in Belfort, one of a dozen Alstom sites across France.<\/p>\n\n\n\n

General\n Electric, which France fined last week for reneging on a commitment to \ncreate 1,000 jobs, has some 4,000 staff in Belfort.<\/p>\n\n\n\n

High\n labour costs, a lack of automation and insufficient investment in \ninnovation have eroded French industrial competitiveness since the late \n1990s, according to economists.<\/p>\n\n\n\n

France\n produces the same quality of products as Spain but at a labour cost \nthat is 20 percent higher, said Patrick Artus, chief economist at French\n bank Natixis.<\/p>\n\n\n\n

He\n said French workers were only fractionally cheaper than German \nemployees in terms of unit cost, but produced an inferior product.<\/p>\n\n\n\n

“I keep telling French politicians that we sell Renault cars with the wages of BMW workers,” Artus said.<\/p>\n\n\n\n

France’s\n weak competitiveness underscores the conundrum Macron faces as he \nsearches for a way to take the sting out of the “yellow vest” rebellion.<\/p>\n\n\n\n

The\n anti-Macron protesters, many of whom are low-income blue-collar \nworkers, have railed since November against Macron’s reforms to \nliberalise the economy and create a better trained, more highly skilled \nand flexible labour force.<\/p>\n\n\n\n

There\n are signs the reforms are bearing fruit. The protesters, though, want \nmore protection from foreign corporations, a higher minimum salary and \nmore money in household coffers.<\/p>\n\n\n\n

Macron\n has already bolstered pay for the lowest earners this year. More \nincreases would only weaken French competitiveness, and productivity \nstill needs to rise, economists say.<\/p>\n\n\n\n

“I don’t see how Macron will get out of this crisis,” Artus said.<\/p>\n\n\n\n

In\n Belfort’s town hall, framed photographs of Alstom’s factory adorn the \noffice of the mayor, who is a member of the conservative opposition \nparty Les Republicains.<\/p>\n\n\n\n

Meslot\n said Macron and the president’s socialist predecessor, Francois \nHollande, had abandoned French industry, putting shareholder dividends \nover long-term strategy.<\/p>\n\n\n\n

“No one knows what will become of the Alstom Belfort plant. For the town’s mayor, that’s a worry,” Meslot said.<\/p>\n\n\n\n

(Reporting by Richard Lough; editing by David Clarke)<\/p>\n\n\n\n

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BELFORT, France (Reuters) – After four decades on the production line at French trainmaker Alstom, Claude Gemino had little sympathy for Emmanuel Macron when Brussels scotched the French president’s hopes of creating a European rail champion.<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1210,1397,868,1103],"tags":[],"class_list":["post-3725","post","type-post","status-publish","format-standard","hentry","category-railroad-news","category-stock-news","category-transportation-news","category-travel-news"],"_links":{"self":[{"href":"https:\/\/planesintheair.com\/index.php?rest_route=\/wp\/v2\/posts\/3725","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/planesintheair.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/planesintheair.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/planesintheair.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/planesintheair.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=3725"}],"version-history":[{"count":3,"href":"https:\/\/planesintheair.com\/index.php?rest_route=\/wp\/v2\/posts\/3725\/revisions"}],"predecessor-version":[{"id":3730,"href":"https:\/\/planesintheair.com\/index.php?rest_route=\/wp\/v2\/posts\/3725\/revisions\/3730"}],"wp:attachment":[{"href":"https:\/\/planesintheair.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=3725"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/planesintheair.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=3725"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/planesintheair.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=3725"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}