MADRID – Angry workers burned tires at the gates of the Nissan carmaking plant in northeastern Spain and prepared for more protests after the Japanese company said it would shut all its manufacturing in the region as it reshuffles its global business.
The decision will lead to 3,000 direct job cuts, which unions say will cause economic ripple effects and impact some 20,000 families in the Catalonia region. They see it as a sign of more widespread job losses to come and the growing pressure on governments struggling to contain the economic fallout of the coronavirus pandemic.
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Although Nissan had been mulling for months to scale down its production in Europe and other parts of the world, the company is suffering like many other automakers from a plunge in demand for vehicles. Reporting a $6.2 billion loss for the fiscal year ending in March, the Japanese giant marked on Thursday its first annual loss in 11 years.
Politicians around the world are debating whether and how to bail out an auto industry that already won billions in government support a decade ago after the 2008 financial crisis. Even before the pandemic, the industry was facing major new costs and disruption as companies rushed to develop cleaner cars and raced to roll out innovations like autonomous vehicles.
The Spanish government on Thursday criticized Nissan's move, arguing it would be cheaper for the carmaker to invest in improving its productivity in the region rather than take on the 1 billion-euro ($1.2 billion) cost of the closure.
“We lament this news,” Economy Minister Nadia Calviño told Spain’s public broadcaster, TVE, adding that the government was seeking more negotiations to “see how to channel this process of find alternative solutions."
“We think this is a plant that has a strategic value for Nissan," said Calviño.
Nissan plans to phase out some 3,000 direct jobs by the end of the year, said Juan Carlos Vicente, head of the workers' committee in Nissan's main factory in the region after a meeting with company executives.
“They are letting us die,” Vicente told hundreds of colleagues who gathered outside the factory. He said Nissan had argued that the business was not competitive even if it added a vehicle to its production line, which currently churns out an electric van and a pick-up truck.
The plant has been operating well under its maximum capacity for months and workers have been striking since the first rumors of the closure emerged on May 4.
“We are going to keep our fight, putting in check governments and asking them to support us in reverting this decision,” Vicente told to a crowd that quickly moved to put fire to a pile of tires.
Reeling from a scandal involving its former chairman, Carlos Ghosn, Yokohama-based Nissan is undergoing a deep restructuring, focusing on China, North America and Japan. The company is leaving the European market, Russia, South America and North Africa to its French partner Renault; and Southeast Asia and Oceania to Mitsubishi.
Management at Renault was also meeting Thursday with unions about its 2 billion-euro cost-cutting plan. The plan had been under discussion since before the virus crisis, but the lockdown and looming recession are darkening the company’s outlook.
Unions fear it could lead to thousands of job cuts and factory closures. Renault is expected to announce the plan Friday.
In Spain, a key question is whether Nissan will need to pay back the subsidies it has received from the government for furloughing workers during the pandemic. The temporary lay-offs were granted under the condition that companies would re-hire the staff after the outbreak, and keep them for at least six months.
José Luis Hernández, who has spent 31 of his 54 years working at the Barcelona plant, said he felt frustrated and helpless: “It's been a whole life here, only to see the company pay us back in this way. It's been a very hard blow.”
Miriam Alameda, a 39 year-old worker, said that the timing made it worse. “We are in the midst of a pandemic and now this," she said. "It's one less salary for the family and a threat to our economic stability.”
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AP writer Aritz Parra reported from Madrid. Angela Charlton in Paris and Yuri Kageyama in Tokyo contributed to this report.