Volkswagen strike slows car exports

Woza Internet, 6 April


Johannesburg (Reuters) - Passenger car exports dropped 20.2 percent in the first two months of 2000, hit by a prolonged strike at Volkswagen South Africa (VWSA), industry officials said on Thursday.

The National Association of Automobile Manufacturers of South Africa (Naamsa) said car exports slowed to 4 937 units in January and February versus 6 190 units in the same period last year. "Car exports continued to lag sales largely due to the disruptions experienced at Volkswagen, one of the industry's major export plants," a Naamsa spokesperson told Reuters. New vehicle sales accelerated 23.9 percent to 31 788 units in March reflecting the country's strong underlying economic fundamentals.

About 300 workers at VWSA's Uitenhage plant in the Eastern Cape province went on a two week strike in late January and early February to demand the reinstatement of 13 representatives suspended by their union for alleged misconduct.

The strike, which was not over any grievance with VWSA, cost the company $56 million in lost turnover and more than 800 units for exports, the production of which was transferred to European plants with excess capacity.

VWSA was in 1998 awarded a contract by its German parent, Volkswagen AG, to supply vehicles to Europe's right- hand drive market. Analysts said while the VWSA strike had harmed confidence among the foreign investor community, they did not expect the effects to linger in the long term as there were signs that industrial relations were improving.

"I don't think it's irreparable. There will be loss of export revenue, part of which will be made up as production catches up again," said Anthony Black, an economist at the University of Cape Town. Naamsa said despite the slow down in the first two months, it remained optimistic that vehicle exports in 2000 would exceed the 59 585 units exported in 1999. Industry analysts forecast export sales reaching at least 70 000 units, boosted by DaimlerChrysler AG's export programme expected to come online in the third quarter of 2000.

VWSA, which accounted for about 60 percent of total vehicle exports in 1999, said it was on track to export 30 000 units to Europe this year. South African vehicle exports are to Europe, Australia and the rest of Africa.

'Simplistic scapegoating' from politicians

Business Report Comment ews&category=opinions_and_analysis&articleID=23 563

Terry Bell, 7 April 2000

W hat on earth happened - and is still happening - at Volkswagen (VWSA) in Uitenhage? Despite the many newspaper centimetres and minutes of radio and television time devoted to the issue, confusion is still the dominant impression. The interventions of provincial politicians and Membathisi Mdladlana, the labour minister, has not clarified matters. They have tended to ascribe blame for a damaging situation to conspiratorial 'ultraleftist' groupings.

That is the sort of simplistic scapegoating one should expect from politicians. It is in their interests to present themselves as the sole sources of stability in a world filled with devious and powerful forces bent on anarchy and destruction. However comforting such simple, good versus evil images may seem, they are seldom accurate. Life is much more complex. The fact that the VWSA dispute still shows no signs of disappearing should be evidence enough of that.

The first indisputable fact about the dispute is that there was a R5 billion export agreement signed between VWSA`s management and the union in 1998. It demanded certain work practices about which a number of workers were not too happy. The second fact is that a significant minority of the largely ANCsupporting workforce support other political parties.

The metalworkers` union, Numsa, to which the workers belong, is affiliated to Cosatu which is, of course, a member of the governing alliance. This provides a potentially divisive situation, especially when the union leadership appears to some workers to ignore the democratic constitution and traditions of the union. The third fact is that the Numsa leadership sacked 13 elected shop stewards, which resulted in nearly a third of the workforce - 1 300 workers - going on strike. It was a strike at VWSA, but against the union leadership. Whether or not Numsa blundered in the sacking of the shop stewards is not the point.

But it is a clearly demonstrable fact that a significant section of the Numsa membership believed that the leadership had blundered. In the tradition of militant solidarity they were prepared to risk their jobs to fight what they perceived as an injustice. They lost their jobs. The VWSA management sacked the 1 300 and set about hiring and training a new workforce. It was a situation tailormade for political intervention. The Pan Africanist Congress and the United Democratic Movement (UDM) had supporters among the sacked workers. So too did the tiny Workers International Vanguard League (WIVL).

All were determined - though the UDM subsequently denied involvement - to win kudos and gain greater support. Although it was by far the smallest element, the WIVL had an advantage: an alternative union. The WIVL offered the Oil General and Allied Workers` Union (Ogawu) as an alternative home to the ''sellout'' Numsa. Ogawu is a breakaway from the Cosatuaffiliated chemical workers` union which came into being when Abraham Agulhas, the elected president of the Cosatu union, was effectively expelled after what his supporters claimed was a ''bureaucratic manoeuvre''.

The sacked Numsa members, however, do not appear to have flocked to the alternative. Quite apart from anything else, Ogawu is not a recognised union at the VWSA plant and thus has no standing in negotiations for reinstatement. And reinstatement is the prime issue for workers in an area with an estimated 60 per cent unemployment rate. It is also a fact that, despite the many reports to the contrary, the sacking of the workers may have been illegal.

Although the 1 300 clearly contravened the conditions of the Labour Relations Act, they are also covered by the conventions of the International Labour Organisation. These are international treaties by which the government is bound and with which local laws are supposed to be in agreement. ILO Convention 98 makes it clear that no worker may be dismissed for exercising the right to strike, though there are various arguable prerequisites as well.

Some of these arguments may emerge in a case being taken before the Commission for Conciliation Mediation and Arbitration by some of the sacked workers. Whether or not the right to strike rule is sensible or wise, is irrelevant: it is part of international law. ''There definitely is a case to be made,'' said Neville Rubin, an honorary professor of law at the University of Cape Town, ''but it`s not necessarily that straightforward.'' So, unfortunately, the potential for continuing confusion - and attendant political point scoring - seems vast.

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