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Light at the other end of the (Channel) tunnel?


SC
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When the UK coalition government announced its planned budget cuts a couple of years ago it was reported on TF1 news as draconian with the comment: "imagine what would happen if the government of France tried to do that here".

Now we know that most of the UK cuts have yet to bite deep, but I wonder what the average Frenchman would think about poor old Britain if he looked at the BBC news site today:

Peugeot Citroen hit by 'crisis' in European car sales

"Sales worldwide were down 16.5%, the French company said"; " sales fell 13% in France"

On the same page were links to: "UK car sales reach four year high" and "US car sales hit five year high". Its was also reported elsewhere that Peugeot's UK sales were up 5.6% in 2012.

The Guardian reported: "Sales of UK-built cars rose 11% in 2012" and last summer there was the headline "Britain now produces more cars than Germany" (in the Mail :) )

I wonder if the French media will pick up on this and how the politicos will respond if questioned.

Steve

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Car sales make profits to pay for the budget. But the budget is till too high so we need to cut it until there are enough car sales to generate the taxes to pay for the inflated budget again.

In france they just find extra ways of getting money off people who then have to turn o the benefits system to survive because they dont have the guts to cut the waste out of the system.
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SC Wrote

When the UK coalition government announced its planned

budget cuts a couple of years ago it was reported on TF1 news as

draconian with the comment: "imagine what would happen if the government

of France tried to do that here".

Now we know that most of the UK cuts have yet to bite deep, but I

wonder what the average Frenchman would think about poor old Britain if

he looked at the BBC news site today:

 I doubt if many Frenchmen would look at the BBC news site ...... As the UK sells  320 newspapers per 1000 people  to the 143 per !000 in  France . Perhaps the UK worker is more aware of what is needed to be done in the way of change to better his lot.  And sees what the bigger picture is  compared to the French worker .?

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I think part of the success of the UK car industry is down to Toyota. They are quite local to where I live and are regarded as first class employers. Their apprenticeships are genuine and the conditions are clear. They also do graduate placements and generally investing in their workers not exploiting them.

Is this true of the big French car firms ?

Hoddy
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Owned by foreigners nowadays who have imposed suitable work patterns and suitable pay. They have loyal, hard working work forces.

Now, compare with Peugeot and Renault - the former seems in a state of decline not helped by unions and now, government interference and the latter manufactures its big success stories abroad or gets the parts there.

Compare too with Toyota in Valenciennes - foreign owned, suitable work patterns and suitable pay. They also have loyal, hard working work forces.

Hmmmmmm

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Surely Toyota, Nissan, and Honda are Japanese?

If they made the same models  in French factories under the same management would we talk of the French car industry?  So really there is no connection to the UK Budget, it is more a question of Japanese management and design.

The productivity of French workers is higher than their British counterpart, but they are still burdened by the fact of having French management and owners.

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[quote user="NormanH"]The productivity of French workers is higher than their British counterpart, but they are still burdened by the fact of having French management and owners.
[/quote]

And labour laws.

Lest this reflect on the average British "worker", conventional productivity per worker is not a measure of how hard someone works as it does not take into account the cost of the financial or intellectual investment to enable that productivity. In an economy or social structure that makes it difficult and expensive to lay off employees, companies will invest in machinery and work practices to achieve productivity gains.

Steve

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[quote user="NormanH"]Surely Toyota, Nissan, and Honda are Japanese?
If they made the same models  in French factories under the same management would we talk of the French car industry?  So really there is no connection to the UK Budget, it is more a question of Japanese management and design.

The productivity of French workers is higher than their British counterpart, but they are still burdened by the fact of having French management and owners.
[/quote]

 

I think that is a rather old and outdated view of the industry Norman. 

Vauxhall is of course American - just as is Opel in Germany.  Ford is American.  The Mini is German.  So yes all across the world you see local vehicle production belonging wholely or in part to a multinational whose head office is somewhere else.  In fact the UK car industry by your definition does not exist any more (well hardly exists).

 

What that view misses is that with today's lean supply chains (aka Just in Time), there are a multitude of component manufacturers sites just a few kilometres from the production plant.  Some of these are again multinationals, but many others are indigenous companies.  So when the Japanese car makes do well, so do a whole host of truely British companies that do well.  The same in France and Germany and across the world.

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Norman wrote:"So really there is no connection to the UK Budget"

Thats right there isn't.

In France, austerity is being seized on as the reason for lack of growth whereas despite those draconian UK budget cuts, ordinary UK citizens are optimistic enough to go out and buy new cars.

"it is more a question of Japanese management and design."

Freedom from the union intransigence in the old British owned car industry, more like.

Steve

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Could I just point out, Norman, as an ex-employee of Renault, that Nissan may be Japanese but it is part-owned by Renault??

Nissan's most productive plant worldwide is in the North-East of the UK. The UK is also one of their bigger European markets, and it's also a bigger market than France for the other Japanese manufacturers who produce and assemble vehicles in the UK.

Renault's graduate scheme (for which, for a number of years, I was responsible in the UK) used to be a big thing, but - and I can't speak for its current status - began to be stifled as Renault France imposed more and more and more constraints on it in terms of the people they wished to recruit. I don't mean in terms of qualifications, either. Oh no. They developed a French "stereotype" (Bac +5, only certain universities, only within a certain age range, only with certain degrees) and decided that anyone not meeting the precise criteria would not be considered. I was once asked to provide a ranking (according to Renault France criteria) for every course at every university in the UK. When I protested that this was impossible, the snotty stagiaire who had been sent over to get the data politely tried to threaten me with complaining to my boss if I did not comply. I told her to go right ahead, and that I didn't intend to be working on a set of useless figures till I retired. She returned to France sans data. However, I well remember a recruit in the UK turning down our offer to take a job with Jaguar, who then decided to rescind all the offers they'd made to graduate trainees in that particular year.

That's all slightly by-the-by.. Most of my current clients are in the automotive industry or related sectors. Some are even Japanese. I'm not sure that within the industry they're quite as optimistic as these figures would have us believe. I think you've got to have a look at how deeply they are having to discount their prices to generate these sales, but then I reckon PSA and Renault in France would refuse to discount their prices even if it meant they'd lose half their sales. Twas ever thus.

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Totally agree with the last paragraph YCCMB.  The Basic European fundamentals are that there is at least 20% overcapacity in Europe and sooner or later something will give.

At the moment it is South Europe (Spain, France, Italy) and Belgium that are under the most pressure, but it could easily swing in another direction and bits of Opel are very vulnerable.  It would not take very much for the UK producers to find themselves in trouble again

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There is an element of that certainly, but as I posted earlier, there is overcapacity in Europe.  As long as export markets have been strong, then that excess gets absorbed.  Once the export markets begin to dry up, and only the models that "the world" really wants are being sold then the weaknesses appear.

I actually think that Honda is in a stronger position than Opel/Vauxhall but time will be the final judge.

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[quote user="woolybanana"]And that splendid Indian company Jaguar Range Rover is recruiting 800 staff.[/quote]

Fairly sure that those new employees of that splendid Indian company Jaguar Range Rover will be pretty pleased about that.

Steve

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