Spain’s government lashes out at Nissan over Barcelona factory closure

The government thought the factory's future was 'guaranteed.'

Spain’s government lashes out at Nissan over Barcelona factory closure

Nissan said Thursday it would close its plant at Barcelona’s Zona Franca, threatening about 3,000 jobs and triggering a scramble among politicians to figure out a contingency plan.

Nissan’s Chief Executive Makoto Uchida confirmed the closure during a video press conference on Thursday in which he announced sweeping restructuring. That’s a major blow for Spain’s Prime Minister Pedro Sánchez, who had insisted earlier this year that the factory’s future was “guaranteed.”

“We considered various measures in Barcelona and although it was a very difficult decision we intend to close the plant,” said Uchida.

On Wednesday, Nissan agreed a new cooperation program with Renault that will see the French carmaker take the lead in Europe as the whole auto industry grapples with expensive shifts in electromobility and autonomous driving systems, as well as the impact of the pandemic.

The closure of the Barcelona factory, which dates back to 1920 but has only been owned by Nissan since 1980, is hardly a surprise. The site had been operating far below its maximum capacity since 2012 and concerns over its viability increased months ago when Nissan cut 600 jobs to reduce costs.

However, Nissan said it will keep open its Sunderland factory in the U.K., despite fears that Brexit could lead to its closure. Its peer Honda last year announced plans to close its Swindon plant in the U.K. by 2022, costing 3,500 jobs.

Auto failure

In its announcement on Thursday, Nissan said it will now redirect its resources toward Japan, China and the United States, giving ground to Renault in Continental Europe.

The production of vans will be shifted from Barcelona to Renault’s French factories.

The decision is a big blow to manufacturing and employment in Spain’s northeastern region of Catalonia, where carmaking has been a crucial sector for decades. About 3,000 direct jobs and between 25,000 and 30,000 indirect jobs depend on Barcelona’s Zona Franca factory.

The decision also represents a failure for Sánchez after months of intense negotiations to persuade Nissan to keep the factory open.

“We regret this decision by Nissan … despite the enormous efforts by the government to keep the business going,” Spain’s Foreign Minister Arancha González said.

Spain insists that saving the Barcelona site is still possible if Nissan were to apply a viability plan developed jointly with the Spanish Ministry of Industry and the Catalan regional government. Spain and Catalonia had offered an injection of up to €100 million — about a third of what Nissan needed to invest to build a new electric vehicle at the Barcelona factory that would ensure its long-term viability.

Spain is determined not to make Nissan’s exit easy. The government argues that closing the factory would cost the company more than €1 billion in compensation to workers and suppliers, as well as the repayment of €25 million in taxpayer money handed to Nissan over the last 12 years. Madrid says that it would be cheaper for Nissan to invest and save the site.

The government also warned that leaving Barcelona and Spain equals “abandoning the European Union, with the consequent reputational damage in a market of more than 500 million people.”

Economic Affairs Minister Nadia Calviño said Thursday the government wants to discuss “an alternative solution” for the Zona Franca site with Nissan and has proposed the creation of a working group.

Unions plan street protests after weeks of being banned from doing so because of Barcelona’s lockdown restrictions. A strike that began on May 4 is set to continue.

“Nissan’s workers will not rest until they persuade the multinational to keep industrial operations in Spain,” said the CCOO union.

Nissan’s decision does not directly affect the future of the company’s other sites in northern Spain, including Ávila, where it produces spare parts, and Cantabria, where it manufactures electric vans.

Aitor Hernández-Morales contributed reporting.

Source : Politico EU More   

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Bruno Le Maire’s Inferno

Can the French finance minister guide his country through the coronavirus crisis?

Bruno Le Maire’s Inferno

PARIS — In Greek mythology, a three-headed dog named Cerberus watches over the entrance to the underworld. At France’s finance ministry, at the height of the coronavirus lockdown, the equivalent was a small, undernourished cat.

For the past three months, the institution known as “Bercy” has been at the center of France’s efforts to offset the hellish impact of the coronavirus crisis. The question now — as countries around the world look toward life after lockdown — is whether the ministry and its top official, Finance Minister Bruno Le Maire, can bring the country’s economy back to life.

“We absorbed the shock, but we absorbed it with €110 billion of spending [and €315 billion of state-guaranteed loans] in France,” Le Maire told POLITICO in an interview late last month. “Now we are entering the second phase and it is going to be much harder.”

It was the end of a long day, and Le Maire, sunk into a beige leather chair, seemed to have dropped his guard.

The finance ministry had pushed through massive bailouts for French industrial flagships like Air France, expanded unemployment benefits for the country’s workers and put in place a  €3.3 billion “solidarity fund” for small and medium-sized businesses affected by the coronavirus crisis.

“He’s a cold and analytical machine” — Former colleague on Bruno Le Maire

And yet, a wave of bankruptcies and layoffs — predictable but nonetheless painful — was putting intense pressure on the French economy and the man tasked with nursing it back to health.

“We’re moving into the phase which I think is the most difficult, the most complex: the transition period, where the patient comes out of the hospital, still can’t fully stand on his own two feet, but he’s all alone,” Le Maire said.

“There are no more nurses, no more caregivers, no more doctors, no more oxygen, no more hospital bed, no more support,” he added. “He’s all alone and he’s a bit hesitant about what he’s going to be able to do.”

POLITICO was granted access to the minister and his entourage during two days in late April and mid-May as Le Maire was preparing to do battle — in France, against the devastation being wrought by the coronavirus, and in Europe, as he and French President Emmanuel Macron worked to close a deal on a pan-European response to the crisis.

What emerged was a portrait of a man — and an institution — struggling to counter the unprecedented economic impact of an unexpected pandemic, and painfully aware that whatever measures are put in place, they are unlikely to be enough.

Analytical machine

A chemically pure product of France’s elite education for top-level public servants, Le Maire has served as a diplomat, a political adviser, the secretary of state for European affairs and the minister for agriculture under former President Nicolas Sarkozy — who used to call him “Baby Bruno,” a swipe at a perceived rival.

“He’s a cold and analytical machine,” said a former colleague of Le Maire in a 2005 interview. Le Maire has silver hair and an aristocratic composure, but his dark blue eyes sometimes betray a tinge of amusement. Even when having casual conversations, he structures his arguments carefully. His preferred tone is a mix of polite distance, authority, attentiveness and paternalism — he’s a father of four boys.

As a politician, Le Maire has also cultivated a rebellious streak — albeit one very much in line with his grand bourgeois upbringing — as a sometimes-risqué novelist.

“Politics has the gift of pulling you out of your narrow milieu,” he wrote in one of his 10 books, “Jours de pouvoirs.”

Nobody would mistake Le Maire for a rock-and-roller (he once saw Mick Jagger in the streets but did not recognize him). But as a student of French literature in university, he was an avowed fan of Marcel Proust and Arthur Rimbaud, and he began to favor friendly happy hours, with a glass of whisky or two, over early morning mass with his devout family.

At about the same time, to pay the bills, he started to write cheap romance novels, including one about a nurse madly in love, under the pseudonym Duc Williams.

As Le Maire has climbed the political ranks, his opponents have sometimes tried to use his writing against him, quoting for example an explicit autobiographical love scene with his wife in Venice in his book “Le Ministre.”

They haven’t had much success. Le Maire has used his image as a bon vivant who loves literature to distinguish himself in the fragmented political landscape created by Macron’s demolition of the traditional political parties.

Bruno Le Maire works at his desk in Bercy | Ludovic Marin/AFP via Getty Images

His books are selling and he is one of the government’s most popular ministers.

Before the coronavirus, Le Maire was one of France’s most visible public officials internationally, championing a digital tax on tech giants (a proposal now mired in technical discussions at the OECD) and building strong, high-profile relationships with his counterparts in Germany, Finance Minister Olaf Scholz and Economy Minister Peter Altmaier, whom he calls several times a week.

But with the French economy headed rapidly downward, he has also turned to the world of words for advice, consulting not only with economists but also literary luminaries like Michel Houellebecq, a controversial novelist known for his dark view of humanity.

“He has a slightly more pessimistic vision than mine, I’d say, but in general he’s quite lucid about the world and about people,” Le Maire said.

Higher office

The finance ministry’s feline guardian was the sole moving presence in late April outside what the French sometimes refer to as “La forteresse de Bercy” — a colossal office complex on the banks of the River Seine.

Odorless roses under a low-lidded sky offered the only other traces of life on the lonely 500-meter gravel-lined walk to the entrance of the Hôtel des Ministres where Le Maire has his officeand one of the best views of Paris.

President Macron, European Commissioner Thierry Breton, European Central Bank Chief Christine Lagarde and Sarkozy all once held the top job at Bercy, but only Lagarde stayed for more than a couple of years.

Le Maire is already into his fourth year as minister, and so far it has seemed his aim has been to stay in office as long as possible. “When your country is affected by the most serious economic crisis in its modern history, it is not time to leave, it is time to stay,” he said.

What will French President Emmanuel Macron do with his prime ministerial position? | François Mori/AFP via Getty Images

Statements like that haven’t stopped French commentators from speculating that the finance minister has his eyes on a higher office — if and when Macron decides to replace Prime Minister Édouard Philippe.

Le Maire’s relentless media presence has done little to quell the rumors.

Since the crisis began on March 1, Le Maire has given at least 18 radio and television interviews on prime time and shared 51 pictures on Instagram, including casual pictures of him in the elevator of Bercy or of his guinea pig Jackie.

The minister also has a team of international press advisers, who send him daily reports on how France’s actions are perceived in other EU countries. “He reads everything,” said a finance ministry official. He is also one of the few French officials who gives interviews to foreign media, most often to press for an EU-level response to the coronavirus crisis.

In Le Maire’s words, this outreach is simply a way of “remaining active on the field” and informing the public of the work of a ministry often little understood by the French.

Worried

With 42 kilometers of gray, office-flanked corridors and a lingering smell of cold tobacco (surprisingly, since smoking has been forbidden since 2007), the Bercy office complex epitomizes the aesthetics of 1980s French bureaucracy: cold, imposing, linear.

It’s a visual reflection of the staid, conservative, technocratic culture that Macron tried to disrupt during his time as finance minister with the vocabulary of the world of startups.

Macron’s disruption didn’t stick — aside from a foosball table in the marble hall, now covered in plastic to avoid the spread of the coronavirus. Bercy remains a top-down organization. That proved useful when its 5,000 people had to start working remotely as France went under lockdown.

Left: A malnourished cat at the entrance to Bercy. Right: A foosball table now covered in plastic to in the ongoing battle against the coronavirus| Photos by Elisa Braun/POLITICO

Even in Bercy’s well-oiled machine, the gloomy prospects of a post-coronavirus era have eroded the troops’ morale. “I’ve had this dream several times now where I’ve been deprived of my freedom,” said one finance ministry official. “It’s really something that worries me, the feeling of being constrained.”

When POLITICO first spoke to Le Maire at the end of April, he was concerned. He was worried that France’s economic trajectory — still not fully recovered from the Yellow Jacket movement and a wave of strikes over a proposed pension reform — would suddenly deteriorate.

He was worried about his personal prospects, how they too could suddenly take a turn for the worse. “Political mistakes, in times like these, are paid for immediately,” he said. It’s a lesson he learned the hard way in 2016, according to a close political adviser, when a promising start during the French conservative presidential primary ended in a humiliating 2.4 percent showing.

“The real risk for the European Union is that it could break up” — Bruno Le Maire, French finance minister

Two weeks later, he was worried too about the pressures that an uneven recovery could have on the rest of the Europe, and what that would mean for a government that has put its continental ambitions at the center of its raison d’être.

“The real risk for the European Union is that it could break up,” he said. “Having countries that are doing very well economically and others that are lagging behind within the same monetary zone, that is simply unacceptable.”

Three days later, Macron joined German Chancellor Angela Merkel by teleconference to jointly announce a Franco-German proposal for a €500 billion coronavirus recovery fund, financed by debt issued by the EU and backed by all 27 members.

Confinement

The economic shock that struck France marked the end of a period in which the finance ministry had put the country on a path to lower unemployment and faster economic growth.

Eight weeks of confinement have cost the French economy €120 billion, according to the French Observatory of Economic Conditions (OFCE), of which around €40 billion has been borne by businesses that have seen revenues collapse. France’s GDP is projected to drop by 8 percent this year, and its public debt is expected to reach unprecedented levels.

In addition to the layoffs and bankruptcies, France has profound narcissistic wounds to heal, as many of its reasons for pride — tourism, cuisine, wine, fashion — may not be compatible with the art de vivre under the coronavirus.

As Le Maire contemplated France’s next chapter, he veered into the literary.

“There are two topics that are extraordinarily interesting as reasons for reflection today, and that is distance and slowness — which are not, between you and me, my main personal characteristics,” he said.

“We had the tsunami. The levee held, but the sea will recede and we will see bankruptcies, layoffs” — Bruno Le Maire

The epidemic, he said — and its likely origins in wildlife — were a dramatic warning about the fragility of the earth’s ecosystem. “We put ourselves at risk by not reestablishing the distances between the worlds on the planet we inhabit,” he added.

“And then there is the slowness,” he said. “We were accustomed in our professions to having hectic lives, where we could do Paris-Rome, Rome-Berlin in the same day.”

That loss of ease of travel, he said, could have harmful implications when it comes to governing, especially at the EU level.

“Negotiation takes place around a table,” he said.” Sometimes we isolate ourselves in small groups, sometimes we come together. If we had such difficulty in concluding the agreement on economic support, I think that the fact that we were not together played a big part. We need to be together.”

The crisis, he said, has the potential to threaten the European democratic model.

Bruno Le Maire surveys an office which is under pressure like rarely before | Ludovic Marin/AFP via Getty Images

“We must be well aware of this: The hardest part is yet to come,” Le Maire said.

Pouring rain was falling on his office’s panoramic windows.

“We had the tsunami,” he said. “The levee held, but the sea will recede and we will see bankruptcies, layoffs. And that is when we will have to adapt our system and provide very strong responses.”

Outside, in the complex’s deserted courtyard, even the small cat was gone.

Source : Politico EU More   

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