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Siemens plant shutdown roils union leaders

Workers debate closure of Zličín rail factory

By Claire Compton
Staff Writer, The Prague Post
July 30th, 2008 issue

Global electronics giant Siemens is struggling to make a clean break from its Kolejová vozidla railway vehicle factory in Prague–Zličín following the company’s July 23 announcement to end operations at the plant.
Nearly 1,000 union workers have been placed on strike notice as roiled union leaders accuse the company of violating EU directives and blind-siding its Czech employees.
“We learned [about the shutdown] from German and Czech media. We can’t help but feel that Czech employees are seen as second-rate,” said Josef Středula, head of the Kovo Czech Metal Workers Federation. “The employees all work for the same company and we are EU members. We’re not a banana republic.”
Kovo demands a job guarantee beyond Sept. 30, 2009, the projected date of the shutdown. Rather than completely shuttering operations, Siemens will attempt to sell the plant to another producer to avoid putting its employees out of work, said company spokesman Petr Sedláček.
However, this announcement failed to diffuse internal tensions. At a July 24 meeting between union representatives and board member Siegfried Russwurm, Středula said workers would strike to meet their demands and requested the formation of a negotiating group. “We are not willing to negotiate with somebody who is not competent enough,” Středula said of the meeting. “We want the leadership to [keep its promises] and do everything we have agreed on.”
Kovo leaders have also delivered a complaint regarding Siemens’ conduct of the situation to Czech EU commissioner for employment, social affairs and equal opportunities Vladimír Špidla and made plans to meet with Germany’s ambassador to the Czech Republic. At press time, Sedláček said the aim of the working group was to “discuss further steps.”
The initial meeting established key points, he said, adding that Siemens wanted to preserve current operations when the plant changed owners.
During the meeting, negotiators also persuaded the leadership to provide “background” information behind the planned shutdown. “It’s important for both parties to secure as many jobs in Zličín as possible,” Sedláček said. “Both the union and Siemens want industrial production to continue.”
Job cuts
The planned shutdown of the Zličín plant is part of Siemens’ effort to consolidate its European plants, which are becoming redundant due to a surge in railway vehicle production in Asian markets, according to Sedláček. “The European railway vehicle market is stagnating,” he said. “Our Asian customers also demand that the vehicles they order are at least partially made in their countries.”
In a July 23 announcement, Siemens Mobility Division CEO Hans-Jörg Grundmann recognized the potential of China’s growing market, and said European consolidation was necessary to maintain long-term competitiveness. Siemens is also competing in a bid for a 50 percent stake in the construction of a factory in India to produce locomotives for Indian Railways, Bloomberg reported July 26.
However, Siemens is not completely abandoning its European railway production activities. The company will continue producing aluminum cars in Krefeld-Uerdingen, Germany, steel cars in Vienna and locomotive production in Munich.
According to Středula, choosing to keep these plants open suggests that Siemens favored its German workers over the Czechs, and is the primary reason for the union’s dissatisfaction with the company’s decisions.
“[Siemens] is not treating all its employees from different countries equally in terms of work protection, because the employees in Germany are protected until Sept. 30, 2010,” Středula said.
While several factories in Siemens’ Mobility division will remain in operation, some positions will be cut as part of the company’s strategy to lay off 1,800 employees in engineering and manufacturing worldwide. A total of 850 German employees will be laid off in its various plants, according to a company statement.
Siemens has railway vehicle operations in Germany, Austria, the Czech Republic and Slovenia. The company employs more than 11,000 workers in the Czech Republic. On July 8, the company announced plans to cut 16,750 jobs worldwide as part of ongoing consolidation efforts. Administrative positions account for a majority of these layoffs.

Claire Compton can be reached at ccompton@praguepost.com


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