Why Rover is at the bottom of the productivity league with Skoda

Jobs crisis: Midlands workers struggle to compete with modern plants but the Bank's policy has no room for special cases
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The Independent Online
IT IS hardly a statistic they are proud of at Longbridge. In the motor industry's league table of productivity the Rover plant ranks just four places off the bottom, alongside Skoda's main factory in the Czech Republic.

In the Munich offices of BMW it is the sort of fact that is pinned to the wall, however, as Rover's German bosses decide whether to commence the run down and eventual closure of the plant with the loss of 18,000 jobs.

The obituary of Longbridge has been written many times, of course. First in the 1970s, when the activities of Red Robbo made the place a byword for trade union militancy and Sir Michael Edwardes came within an ace of pulling the plug. Then in the 1980s, when Margaret Thatcher tried, and ultimately failed, to sell Austin Rover as it then was to Ford, a move which would have almost certainly have left Longbridge surplus to requirements.

Reports of its death may be premature again this time. But there is a steely determination in the eyes of BMW, which does not augur well.

It has invested pounds 3bn in Rover since buying it in 1994, to be repaid only with mounting losses and a succession of cars that have failed to capture the public imagination.

Threatening closure is a neat way of concentrating the minds of the unions and focusing attention in Downing Street, even though a government rescue package does not appear to be on the cards. Longbridge, like the coal mines, must save itself. There will be no favours and no free lunches.

If BMW does not get government aid to build the new Mini at Longbridge, then the writing will almost certainly be on the wall. Without state support, it will be cheaper to build the car at Cowley in Oxford, which is much more modern and in any case has huge spare capacity.

The reality is that death by a thousand cuts has already begun. The 1,500 job cuts announced in July have been implemented and now a further 2,400 are in store, the vast bulk of which will fall on Longbridge.

The dilemma facing Longbridge is a simple one. It has the workforce of a volume car plant but not the sales to go with it. According to the latest productivity figures, Nissan's Sunderland factory in the North- east produces three times as many vehicles per man as Rover's flagship plant.

Part of the reason is historical. Longbridge has grown up over decades and occupies a vast, sprawling complex on the edge of Birmingham, whereas the Nissan plant is on a greenfield site.

Until recently Longbridge also produced six models, compared with the two manufactured at Sunderland. But neither of these factors can explain the discrepancy in output - nor the 30 per cent productivity gap which BMW estimates there is between its cars plants in Germany and Longbridge.

Last year, Longbridge ranked fourth from bottom in a productivity league table of Europe's 30 leading car plants drawn up by the Economist Intelligence Unit.

Its 9,000 assembly line workers produced just under 330,000 cars which equates to a productivity of 33 cars per man. In contrast, Nissan's Sunderland plant produced 272,000 cars with an equivalent workforce of just under 4,000, giving it a productivity level of 98 vehicles per employee.

Rover says it has improved productivity across the group by 19 per cent in the past two years and the July job cuts will have lifted the figure further.

It has also rationalised Longbridge by ending production of the Rover 100 to concentrate on the Rover 200 and 400 series, the Mini and the MGF. But both the Mini and the MGF are produced in relatively small volumes.

Trying to make direct comparisons between Rover's UK plants and those of BMW in Germany is complicated by the different model ranges and price brackets of the two marques. A BMW spokesman said that it produced just under 10 cars per employee last year, compared with 13.3 at Rover. But the average price of each car sold by BMW is pounds 21,600, compared with pounds 12,700 for Rover.

When all these figures are factored in the BMW chairman, Bernd Pischetsrieder, calculates that BMW achieves 30 per cent more value per employee than Rover.

Neither manufacturer matches the sheer efficiency of the Japanese, however, who boast the five most productive car plants in the world.

The British Car Worker

Rover - workforce 38,000

Age: 45. Average of 14 years service.

Hours: A basic of 37 hours a week.

Salary: pounds 16,000. Paid monthly directly into their bank accounts.

Overtime: Shift premiums can increase pay by as much as pounds 100 a week depending on what shift pattern is worked.

Overtime and work pattern: There is no clocking on. Each of the three main car plants - Longbridge, Cowley and Solihull - has a health centre, learning centre and creche. Contributory pension scheme.

After 10 years' service, employees are entitled to join the Associate Car Ownership Plan, allowing them to buy a car at preferential rates.

Under Rover's New Deal agreement signed in 1992, employees are entitled to a job for life with no compulsory redundancy in return for greater labour flexibility.

Holidays: Employees receive 25 days holiday a year and extra days depending on length of service. They are also entitled to bereavement leave and paternity leave.

BMW - workforce 68,500

Age: On average younger than at Rover.

Hours: Under the flexible practices introduced in recent years, workers tend to do nine-hour days in a four-day week, including one Saturday every three weeks.

Salary: The hourly wage for a BMW assembly line worker is DM35 (pounds 12.50) before tax. That amounts to annual earnings of DM63,700 (pounds 22,600) before bonuses.

Overtime and work pattern: There is a bonus for night and Sunday work, but not for Saturdays. In the Munich plant, the system allows for one long weekend from Fridays to Mondays every five weeks. Working hours can be adjusted by the company depending on seasonal factors and demand. All shortfalls or overshoots are recorded in the "working time account", and settled in the course of several years.

Benefits: Workers get discounts on cars bought through the company, cheap mortgages, and pension contributions and health insurance in line with standard German practice.

Holidays: Six weeks' annual leave, plus around 16 days a year in public holidays. There is an additional holiday pay amounting to 60 per cent of a month's wages, plus a Christmas bonus depending on length of service. Employees on full contracts are also entitled to paid sabbatical leave.

The German Car Worker

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