Friday, December 11, 1998 Published at 13:09 GMT
Business: The Company File
Rover workers accept deal
The company wants to cut costs and increase productivity
Rover workers have voted to accept radical changes to working practices and redundancies which will secure the future of the company's Longbridge plant in Birmingham.
In return, the company's German owner, BMW, has promised to invest a further £2bn to build four new models, including a new Mini, and new machinery.
The agreement is designed to improve productivity to help secure Rover's long-term future.
The result of the vote was welcomed by both union leaders and managers of Rover.
Ken Jackson, general secretary of the Amalgamated Engineering and Electrical Union, said: "This excellent result puts Rover on course for success and the workforce on course for stability."
Roger Lyons, general secretary of the Manufacturing Science and Finance Union, said: "This is a vote of confidence in the future of the car industry and shows that partnership is now the central focus of British industrial relations."
BMW chariman Bernd Pischetsrieder said the decision was "a milestone" and the workers and unions had "made a most important contribution...to secure a successful future for Rover".
Longbridge at stake
The factory produces the Mini, the MGF, the Rover 200 and the Rover 400.
The Bavarian manufacturer bought Rover four years ago and has since invested billions of pounds, without seeing much in return.
Walter Hasselkus, Rover's chairman, has left the company after acknowledging that he "got it wrong". BMW has also blamed the strong pound for hitting Rover sales.
All 39,000 workers at Rover were balloted on the package after it was outlined to them in a series of meetings, including a mass gathering at Birmingham's National Exhibition Centre.
The main points of the deal are:
The government has promised £740,000 to help Rover workers find new jobs. The money will go on training courses and is supposed to ease the company's restructuring process.
Productivity is the key to Rover's survival. The figures for the Longbridge plant look particularly bad. Because of decades of under-investment and outdated working practices, the plant produces just 33 cars per worker annually. In comparison, the Nissan factory in Sunderland churns out 98 cars per worker each year.
Within the UK, Sunderland is an exception. At car plants across the country, productivity is much lower than for example in Germany and the United States.
BMW is now expected to press the government for a grant aid of up to £200m to build a new medium-sized car in Britain.
BMW has criticised the government for subsidising other car makers by giving them huge grants, which is claims has made it difficult to compete in the UK.
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