Production at UK Peugeot plant at standstill

Production of cars at Peugeot-Citroen’s UK plant was at a standstill today as workers considered their next move following the stunning news that the plant is to close with the loss of 2,300 jobs.

Workers at the site in Ryton, Coventry were told by the company not to report for the start of their day shift at 6am because of a series of meetings being held throughout the day following the closure announcement.

Union shop stewards will meet this morning before mass meetings of the workforce inside the plant later.

Peugeot-Citroen said it planned to restart production later today but a spokesman said workers were being given time to digest the news.

No cars were built on the afternoon shift yesterday after the company’s chief executive Jean Martin Folz flew in from France to disclose that Ryton will close in two stages by the summer of next year.

About 350 of Peugeot’s 206 models are built on each shift at the factory.

Peugeot-Citroen today made it clear they will not change the decision to close Ryton, which the company repeated was the most expensive of its European plants to run.

“We have no choice but to do it,” director of communications John Goodman told BBC Radio 4’s Today programme.

He said each car built at Ryton cost €415 more than in other Peugeot-Citroen factories in Europe.

“The reasoning behind this is based on economics. We import 75% of the parts and export 70% of production. We have very high logistical costs.”

Mr Goodman admitted there had been productivity improvements at Ryton, but added the company had faced huge increases in raw material costs, amounting to €350m at Ryton last year.

Union officials continued to criticise the company today for the decision, which one leader said had “poleaxed” workers.

The unions also stepped up their attack on employment laws in this country, which they said made it easier to sack workers than elsewhere in Europe.

Derek Simpson, general secretary of Amicus, said it was “ironic” that the French government had tried to introduce new flexible labour laws in recent weeks, but had been forced to scrap the plans following huge public protests.

“It seems that the French public was right – the only people benefiting from this are the French. It is inconceivable that workers in France would be laid off on this scale.

“Weak UK labour laws are allowing British workers to be sacrificed at the expense of a flexible labour market.”

The Government hit back at Amicus, pointing to the UK’s strong employment record, which has seen this country have one of the lowest unemployment rates in Europe.

Some of the workers who left the plant following the announcement yesterday voiced concerns about whether they could find other jobs in the area, following a string of motor industry closures in recent years.

About 6,000 workers lost their jobs last year because of the collapse of MG Rover in Birmingham, while more than 1,000 jobs were lost in Coventry 18 months ago following the decision to stop building Jaguar cars in the city.