The first picket of the workers of the Ford factory in Vsevolozhsk, which is closing down, lasted half an hour. 300 people came out to Yubileynaya Square to draw attention from the management of the company's offices in Europe and America. They're failing to negotiate the parameters of the dismissal with the Russian management. The workers believe that the foreigners will make fairer decisions on the conditions of parting. For now, the only thing to support this is the Latin origin of the word "compromise."
SPECIAL REPORT. END OF THE SHIFT
A shift at the Ford Factory is over. 974 staff employees are hurrying either home or to a job interview. They have no more than two months left to find a new job.
Mikhail Sergeev, Ford trade union: "The payroll rate is quite high. The only thing is that we haven't seen those payments in a long while. But even given that we're working half time, and we're often idle, naturally, after all these reductions, line workers have a monthly paycheck of 20,000–30,000 rubles ($380-460)".
The Ford employees found out that Ford was closing down from the news. The official announcement from management came only the next day. From that moment on, the factory in Vsevolozhsk has become a place of social tension. The people who are losing their job by the means of their trade union are fighting to gain maximum security in their dismissal, by being paid for their voluntary resignation.
Mikhail Sergeev, Ford trade union: "We'd like to secure the same conditions which... again, it's in overall volume, not in a net cash equivalent, the same condition that our colleagues in Europe have. We want to get 24 months worth of paychecks under the program of volunteer resignation. Of course, these are our paychecks, not German, French or Romanian ones".
Recently, Ford is leaving many regions. Therefore, they're dismissing many workers. Simultaneously, with the closing of the factory in Russia, they are reducing a large staff in Germany.
Their payment package is as follows. The workers who are over 50 years old are offered an early retirement. At the same time, Ford is co-financing this pension along with the government. Younger workers get a one-time payment of €30,000, plus a month's worth of wages for each year that they've have worked for the company. The limitation is a minimum of 5 and maximum of 18. So that's about 2 years worth of pay for 12 years of employment.
Alexandr Safonov, Academy of Labor: "Why were the standards set this way? The thing is, the quality of the labor market in Western countries is much more complicated. A person who has lost a job in a specific industry, as there can be just a single factory of this kind in the whole country, finds it much harder to find a new job than a person in such country as ours. That's why trade unions required this level of security for a worker so that he or she could look for another job while unemployed or move to another region, or maybe complete additional professional training".
Ford's proposal to the Russian workers sounded as follows. If a worker resigns voluntarily before April 22nd, the number of monthly paychecks he will receive will be equal to the number of years he or she worked at the factory, plus one more paycheck. Therefore, 8 months of wages for a person who has worked for 7 years and so on. The limit is 12. This dismissal wage is more than the one defined by Russian law. But the workers in Vsevolozhsk, evidently, want more security, and are asking for 24. The reason for this is the average age of the staff.
Tatyana Bazhenova, worker: "Many people are now over 40. Where will we find a job? Where will we find a stable job with decent pay? Many workers pay loans, not only mortgage loans, for housing. Many people pay consumer loans".
Elena has worked at the Ford factory for eight years. She relocated to Leningrad Oblast from Kirov Oblast. The amount of her first paycheck was stated in dollars back then. At that time, it was around 40,000 rubles ($1300). Even now, this is a decent sum for Vsevolozhsk. During her time working for Ford, she managed to purchase a small land plot with an old house. Now, Elena lives here with her two daughters and keeps a household in her free time.
- Was there a big storm?
Elena: “No, it's was just snow. It just I didn't know that you should clean the snow around a greenhouse. That's why my greenhouse collapsed.”
Most workers have no desire to relocate anywhere. The most optimal employment option for them are similar automobile assembly plants in Leningrad Oblast. They have tried it, but problems arise.
Alexey Ivanov, worker: Neither Toyota nor Hyundai, not even Nokian Tires here hire workers from Ford. I don't know to what extent that's true, I haven't applied myself. But they say that some kind of agreement exists among corporations and manufacturers to not hire them.
- In order to avoid staff turnover?
- No. Most probably, it's because of the trade union. Because it's Ford who gave birth... who led this trade union movement, and since then employers are reluctant to hire us.
The corporation has always supported the trade union movement, while the workers themselves took an active part in it. The trade union could solve any worker's problem concerning the relations with upper management. On the background of the manufacturing halt, the negotiations were joined by the Leningrad Oblast government.
Alexey Britsun, Labor Committee: "Our job now is organizing the efforts to find new jobs for them, if need be, so that they transfer quickly to a new position and start working at their new workplace. This is our main job as the employment service of the Government of Leningrad Oblast".
The workers are confident that the factory could continue operating at a profit. There were ideas to fit Ford models with a natural-gas engine or making the model cheaper by removing unnecessary electronic systems in the car. There have never been any problems with sales. The brand is still popular with consumers.
In a branded Ford showroom in the north of Saint Petersburg, there are crowds. For the middle of the work week, there are a lot of people. Most of them are businessmen. They buy the foreign-brand cars, whose production in Russia will soon cease, in order to use them in the future.
- Ivan, how are the sales are going?
Ivan Kuts, head marketer of the Trading Company:
- As soon as the news about Ford leaving Russia was published, sales plummeted by about 70%.
After the factory announced additional discounts, sales doubled again. By the way, at the moment of leaving prices for the main Ford models, the Focus and the Mondeo, graded up with their main competitors, Kia and Hyundai. It was something the consumers have been waiting for a long time.
Ivan Kuts, head marketer of the Trading Company: “Ford will stay in one form or another, as there is a division manufacturing commercial Ford cars. It's quite strong. For example, the Transit, they are seen in the distance. It means that Ford isn't winding down its presence. Moreover, Ford leaves its guarantee support here in any case. Accordingly, their services will stay. One cannot simply leave Russia. We'll adjust these relationships in the legal point of view. And at the moment, we're planning to find a good replacement.”
This replacement will anyway come with a price. First, of course, the consumer flow will decrease. Second, different manufacturers have different requirements to exhibit their cars. They concern both the parameters of the building itself and the neighbor: the brands which may be located nearby. Now, the main Ford's problem is competitors from Asia. In Russia, the manufacture and sales of Korean cars are booming.
Sergey Znamensky, Autoreview newspaper: "The Koreans expanded to our market on time with the right product. Those were platform B cars, sedans. But their size was comparable to that of the Golf, or C-class cars, I mean the Solaris and the Rio, which are very similar to sedans and hatchback like the Focus by their spaciousness inside, practicality, and by their design in general".
Experts share the opinion that, in the next 10 years, Ford will have a hard time trying to restore its positions in the Russian and European markets. The cars will be sold to fans of the brands, and, naturally, they'll have to import them. And the main reason for this is the absence of a fundamentally new, interesting flagship.
At the beginning of 1930s, Ford also saw an abrupt decrease in sales. People stopped buying one of the most mass-manufactured cars of all time, the Model T. In the first place, because of activities of manufacturers such as Chrysler and General Motors. This car helped save the day, the Model A. When buying it, you could choose the package and the color. The optimal proportion of price and quality is something the Ford Company was praised for both now and then. But, as it often happens, a consumer finds it more important to be special and modern.
Thus, in several regional markets simultaneously, the Focus and the Mondeo models are following in the footsteps of the legendary Model T. They're forced to leave before they could.
In Naberezhnye Chelny, Tatarstan, they know about the global problems of automobile manufacturers from their own life experience. Kamaz still forms 47% of the city's economy. The company is the main taxpayer and employer. Any of its past problems backlashes to the city's population immediately. Now, it's no longer so. Both the company and the city have changed.
Ilydar Mykhtarov, supervisor: "Nothing good about that. But, I think, taking into consideration the experience we've gained, all of us will be able to find a job. There won't be any problems anyway".
The calm attitude of the workers in Naberezhnye Chelny is understandable. The economy of a half-a-million people city is obviously stronger than that of Vsevolozhsk. And, most importantly, the largest enterprise for manufacturing the famous trucks is located on the bank of the Kama River.
For now, Ford is succeeding in implementing only half of the company's plan on the voluntary dismissal of workers. There are people ready to sign a resignation letter, receive 12 months worth of paychecks, and leave. But all of them are in Naberezhnye Chelny. There are two reasons for that. Firstly, the best of them will be able to continue their career in the company, in Yelabuga, where production isn't shutting down. There's an alternative for the rest; it's our dear Kamaz.
Oleg Afanasiev, Kamaz: "We're aware of the number of people that they're going to dismiss. We're studying the situation, and based on that we can say that we can hire almost all of the workers who will be dismissed from FordSollers. As a rule, those are workers who are already well-trained, their specializations and professions are very similar to ours. Moreover, many of them have previously worked at Kamaz, at the sites of our former mini-car factory."
The Kamaz Company is not the only employment option. Naberezhnye Chelny, a mono-city in the past, has been an advanced-development zone for three years already. Businesses receive considerable tax benefits. Within the next month, several new enterprises will open.
Albert Karimov, Government of Tatarstan: "Around seven new manufacture facilities in the advanced development zone. They will create about 800 new jobs. Moreover, new manufacturing facilities will open in the city of Naberezhnye Chelny. That's why we expect those workers to find new employment".
On April 10th, a special vacant jobs center was opened at the factory. There, three companies simultaneously proposed the workers to apply for a job. Everything depends on an individual, but in any case, they teach you a certain standard of work and thinking. And, basically, this standard is aimed at being the best. You should become better as a person, as a worker or a manager.
Ildar Mukhtarov, using his own words, has nearly quoted Henry Ford. "We have but one tradition: everything can always be done better than it is being done". Over many years, the Ford Company has succeeded in teaching this attitude to most of its workers. A real fight is on to hire 1,000 now unemployed workers.
Eldar Temirgaliev, executive committee: "Pipe Plant of Naberezhnye Chelny submitted a 50 new jobs applications. A new plant in Khaira that will be launched as early as August will create 500-600 new jobs. Actually, this new industrial site, Khaira, is planned to create 5,000 new jobs. Now you see that jobs are in great supply for those people. That's why we call the modern Naberezhnye Chelny a magnet, and we're waiting for an inflow of manpower from other regions".
At the beginning of the week, in Vsevolozhsk, there was a big meeting between the trade unions and the regional government. Its outcome is the decision to boost cooperation in the area of finding jobs. At the same time, on May 5th, another meeting authorized by the government is planned. The requirements are the same: to change the parameters of the voluntary resignation.
Alexey Britsun, Labor Committee: "Today, I'd actually propose to the workers of the factory to focus on their manufacturing plan and do their work diligently. Because other enterprises are watching them now, which may employ them in the future. A lot depends on the way they behave now. Because, as a matter of fact, if we now focus on protest events it won't bring benefits to anyone".
Discipline has its own facets. They say they have started a so-called work-to-rule action. It's a form of protest where workers work strictly according to instructions. One of the consequences is lowering productivity.
Dmitry Yalov, Leningrad Oblast Government: "We realize that ideal option would be alternative investors coming to this industrial site. And they should work in the area of automobile manufacturing. We know that the owners are negotiating with two major automobile manufacturers. We, on our part, as a region, will be ready to provide those manufacturers with as many benefits as possible, both concerning the estate tax and the income tax, as well as to support them in all the permit procedures, in order to urge such an investor to make an affirmative decision".
If the deal is closed, the workers will have the priority with the employment. While the Ford Company will leave the Russian market with its head held high. This solution is optimal for everyone.
