Bombardier to cut 20% of its workforce in Northern Ireland…

There’s been a decline in Bombardier’s business globally (not just NI). Specifically the new C Series jet has run into commercial trouble, not least because the fuel efficiency it hoped would be a strong selling point has been neutralised by the oil price collapse.

According to the BBC

Bombardier Vice-President Michael Ryan said: “The whole global aerospace world is looking at how they can optimise their costbase and that includes going to what we would call lower cost countries.

“If we want to compete being in a global market place then we need to take advantage of that where it’s relevant.

“But I have to say that the technologies we’re investing in, the value-added process, the higher value programmes we’re looking at, are a key part of Belfast’s future going forward and will continue to be.”

Of course the Quebec government’s $1 billion bailout (and 49.5% equity in the project) after a 4.9 billion loss in Q3 last year might also have something had something to do with it.

Northern Ireland is not alone. Worldwide, 7000 jobs are going with NI accounting for most of the job losses in the UK. The Guardian reports:

Of the 580 Belfast posts being cut this year, 380 come from the group’s complementary labour force, which is made up of temporary and agency workers and fluctuates depending on projects. Bombardier’s unionised workforce in Northern Ireland was asked to accept pay cuts last year but rejected them.

From the Union’s point of view…

Davy Thompson, [Unite] the union’s regional coordinating officer, said: “The Northern Ireland executive needs to redouble their efforts and secure alternative employment for those highly skilled workers who will be made redundant. Invest NI must now commit themselves fully to proactively seeking foreign investment in manufacturing.”

Quite. [You’ll have to get them to take their fingers out of their ears first – Ed.] The irony is that the C series jet was originally projected to bring 900 new jobs, which might have enabled Shorts to restructure the abiding jobs imbalances at the factory.

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  • SDLP supporter

    Disastrous for the NI economy, and the workers involved, and it may signal the end of substantial aerospace industry in NI, which has been here since the 1930s. My understanding is that the C Series was not only in competition with Boeing and Airbus but was up against a very good plane produced by the Brazilian company, Embrair. These jobs were heavily subsidised and I have a recollection of Richard Needham, probably a couple of decades ago, saying that sorting out Shorts for sales to Bombardier cost the taxpayer at that time something like £900 million. As for the future of manufacturing here, does anyone have any answers?

  • Zig70

    If you are in the manufacturing sector then job losses are a fact of life. It will be a rare product that lasts a lifetime. I just can’t believe the electorate aren’t grown up enough to know that politicians can do precious little to bring or keep jobs, especially with the lack of power here. Different narrative in the south with more appreciation for who actually creates jobs or is that just hiding from responsibility for the banks…

  • the rich get richer

    Very tough on workers. Very sad to hear about these job losses.

  • mickfealty

    The line Micheal Martin has used is that government doesn’t create jobs but they do create the environment in which jobs can be more readily created. Alternatively they can do the opposite too.

    A lot of work and money was spent getting industry to renew both in the north and in the south in the 50s and 60s. But I get a sense that those gains have been rested on ever since.

  • Belfast Barman(ager)

    I recall last April at the Slugger O’Toole East Belfast Hustings debate between Naomi Long and Gavin Robinson, Gavin tried to give Naomi a hard time for some comments she had made.

    Naomi, among other statements, had said something to the effect of, “We need to be concerned about manufacturing jobs, especially if the UK is to leave the EU.”

    Gavin, quick to jump atop the point, chastised Naomi, saying she needed to talk positively about manufacturing in Northern Ireland (in my view, the political equivalent of putting your fingers in your ears, closing your eyes and shouting LA LA LA I CAN’T HEAR YOU).

    Less than a year later and Gavin is on Nolan Live talking about the “global crisis in the aerospace industry” – what confidence does this instil in the remaining employees here of Bombardier.

    Maybe the job wasn’t as simple as Gavin thought it would be… reality sucks.

  • Karl

    Small scale engineering based manufacturing has no place in remote first world (I know the term is not PC but I didnt want to say ‘industrialised’) locations. Subsidising Bombardier and the like is peeing against the wind. Better to spend the money on researching what NI could be good at. Maritime R&D, local SMEs, software dev, renewable energy, pharma research – all possibles.
    This is a good opportunity to see which way the wind is blowing and start harnessing it.

  • mickfealty

    Yes, but as you can see from above it is also true.

  • Belfast Barman(ager)

    Oh indeed it is true, not in dispute… more the 180 from G-Rob, criticising the then MP for, as it turns out, having a good understanding of the realities of the situation for manufacturing (both locally and beyond).

  • SDLP supporter

    I wish it was as simple as that, Karl. I have known several very shrewd people who lost substantial sums on wind energy projects. Counter-intuitively, (given our mediocre climate) photovoltaic cells for solar energy is seen by some as a better bet than wind power. Being a successful entrepreneur seems often to be a matter of good fortune rather than good judgement. Being an entrepreneur and starting a business offering internationally tradeable goods and services is one of the hardest things to do in the world and 80% of business start-ups fail within five years. One thing we could do is proactively skew our educational system towards mathematics and the hard sciences (physics, chemistry, etc). I know I am interested in politics, but I am taken aback by the number of young folk with not-very-marketable degree in political science, sociology, law and similar subjects and I fear for their employment future.

  • chrisjones2

    The debate on NOLAN last night on the BBC was a disgraceful shambles. Any industrialist looking at that would run a mile before investing here

  • Karl

    I agree, its not simple, but we can say that manufacturing, heavy industry and textiles is not the future. For a place like NI, R&D and knowledge based economy is. Do the government spend 25 million on giving Arlene and Martin a photo op with a multi national that will be gone in 10 years or do they spend it on subsidised office space, tech centres, fibre upgrades, networking conferences to encourage the right environment to create growth?
    Its a no brainer yet they continue to subsidise ‘flagship’ project and talk about high quality jobs, as opposed to creating wealth using the value add of ideas, expertise and knowledge. The raw materials are already in place. You just need to mine them correctly.

  • Chingford Man

    The UK’s manufacturing base has been eroding for the last 60 years. (Others would argue far longer.) If Naomi Long really thinks the EU is significant in this regard, she doesn’t have as good an understanding as you claim.

  • Thomas Barber

    “Counter-intuitively, (given our mediocre climate) photovoltaic cells for
    solar energy is seen by some as a better bet than wind power”

    That would really mess things up for some people SDLP Supporter.

    http://www.counterpunch.org/2013/05/14/big-oils-war-on-the-sun/

  • ted hagan

    Well Eastwood ended up tying himself in knots.

  • Kevin Breslin

    Well Compare the arguements

  • Kevin Breslin

    Here’s a suggestion, maybe some higher/further education on promoting Computer Aided Design. I have five months experience of AutoCAD and people are headhunting me. This is a generic manufacturing skill these days. Doesn’t require a degree in physics or engineering (as someone who has both) to understand it.

  • Cosmo

    agree. The Scots promote sciences more. Education needs to re- emphasise foreign languages too.

  • Kev Hughes

    Sorry Mick, but some of your post doesn’t make that much sense.

    ‘the fuel efficiency it hoped would be a strong selling point has been neutralised by the oil price collapse’

    I doubt that the real reason this is not getting off the ground in the way it should’ve and the link you provided would only confirm that; companies are still looking for fuel efficient planes and that will not go away anytime soon. This was a leap into the dark, so to speak, for Bombardier, where they were going to go toe to toe with Boeing and Airbus and into a sector which is far more cut throat than anything they had dealt with before. The fact that they do not have any real political heavy weights who can lean on prospective buyers (think AIRBUS with EU wide legacy carriers and likewise with Boeing across the US) to help create an order book that gave it some momentum and, dare I say, excitement (?) about the product.

    Where oil would’ve proved a factor is if say they wished to export to Russia where air travel is highly coveted owing to the distances to be covered. Again, I think that while they have a great plane and have faced huge internal problems (most organisations trying to pull of something like they have done will face these) the fact they didn’t focus on having a few anchor customers makes me think they didn’t do their research in the first place.

  • Kevin Breslin

    How can you advocate Maritime R&D and say small scale engineering based manufacturing has no place in remote first world? Maritime regions are remote, and R&D I would assume could be put towards small scale manufacturing.

  • Kevin Breslin

    I am not one for giving Stephen Farry credit lightly, but his work in this area doesn’t get acknowledged.

    http://www.northernireland.gov.uk/index/media-centre/news-departments/news-del/news-del-october-2014/news-del-171014-farry-commend-college-led.htm

  • Karl

    The key is engineering based manufacturing. Maritime R&D could be set up and their findings patented and if applicable built somewhere else.
    Building wings for a regional aircraft of a relatively small company in Belfast does not make sense and wouldnt be there if there wasnt a fascination with big projects and attracting ‘fashionable industries’
    Manufacturing requires raw material to be turned into something and sold for more. With the cost of manufacturing being made up of raw materials, factory costs and wages. Why would a business that is already paying for the raw materials (same price globally) choose NI with high cost factories and high cost workers (relatively speaking)? Answer – subsidies.
    Maritime regions are not remote – Korea, Japan and Chinas coastal regions are the centre of world ship builing. NI is remote in terms of global aircraft production.
    Its a messy answer but ….

  • Kevin Breslin

    I’d hardly call Bombardier relatively small in terms of the Belfast manufacturing scene. That would be like saying Seagate is relatively small in the next major city in Northern Ireland.

    You also say manufacturing requires raw material to be turned into something and sold for more. That is true of anything, and in particular the difficulties in maritime production for Europe.

    Korea, Japan and China are major steel producers, why?
    Simply for that reason.

    They have easy access to the two most dominant iron ore mining regions Australia and China, so steel production is much cheaper than Europe, doesn’t matter inside EU like Sweden or outside like Norway, even Russia with its vast Siberian mines isn’t immune. Europe wasted a lot of its natural raw iron reserves getting in wars at the start of the century, and you can’t really built a ship out of anything else economically. Europe needs ships to make ships, China does not.

    What Europe, North America, heck everywhere else except the Eastern Pacific rim has to do is be resourceful and be specialist, that’s why huge investment in science, multinational assembly, precision engineering standards and the free movement of scientists and knowledge is so vital. The Solvay Conference a vital example.

    It’s not just a case of steel, but specialist steel immune to Chinese dumped generic stuff, that could keep the industry literally pun intended afloat.

    Europe doesn’t have a lot of resources, it needs to be resourceful and well networked. The old imperial days, the war economies, the Marshall Plan post-war economies, the mercantilism, the slave trade, the manifest destiny mentality even huge 50-70’s state nationalization of industries these really are not options for modern Europe.

    So there certainly is space for R&D in the area, but how much can actually be done in these shores if the industry itself isn’t there?

  • Gopher

    The workers were balloted on a pay cut, they exercised their right not to take that cut. The firm have now exercised their right to cut the workforce. The assembly wont lengthen the City runway, build John Lewis, a waste incinerator, allow fracking or most forms of exploration. They denied off shore wind farms,keep passenger duty and hamstring tourism at every opportunity with arcane licensing regulations. So their wont be any jobs to compensate unless of course you want to be an overpaid civil servant skewing the private sector or sit on a quango.