French union understands “Buy American” on tanker

Update, July 19: Airbus says CGT is fourth Union out of five for Airbus in France, representing about 10 percent of Airbus employees in France.

Update, July 16: We received this from CGT:  the union severed ties in 1978.Christian and Jean-Jacques were amused and laughed about the Airbus response.

Original Post:

Only a few days after EADS and Boeing (and the long-shot bid from US Aerospace-Antonov) submitted their bids for the $35bn KC-X contract to supply tankers to the US Air Force, a French union at Airbus declined to endorse the EADS bid.

The Federation des Travailleurs de la Metallurgie, or CGT, holds the position that the French military should buy its equipment from French industry and to be consistent with this position, told us that it understands the “Buy American” approach of Boeing supporters.

Airbus and EADS dismissed the CGT’s view as that held by a minority union concerned about outsourcing and off-shore jobs.

“We want the French industry to supply all equipment to the French military. We understand why American unions believe that US industry should supply the equipment to the US military,” said Jean-Jaques Desvignes and Christian Pilichowski on behalf of FTM CGT, the French metal workers CGT union.

They were in Seattle this week meeting with SPEEA and IAM 751, Boeing’s two principal unions in Puget Sound, and met with selected journalists as well.

“We do not want to take position about the choice of the USAF, this is not our concern,” the union leaders said. “We take the position according to our view of independence of each country and to achieve this goal each air force should rely on its own industry to provide aircraft. (The same is true for the Navy and the Army.)”

Asked directly if this position was an endorsement for the KC-767 bid, the union stood by their statement.

The reaction from Airbus was sharp.

Rainer Ohler, an Airbus spokesman in Europe, said:

“The CGT is a small, minority union with traditional ties to the French Communist Party.   It doesn’t speak for the majority of Airbus employees but, rather, a small minority. This union has something in common with Boeing and its surrogates, however: a very national and narrow view of competition.”

One observer says the CGT cut its ties to the Communist Party following the collapse of the Soviet Union in 1991.

“CGT cut all formal ties with the French Communist Party in the early 1990s (when much of the European left was realigning itself after the collapse of soviet totalitarian communism).” This same observer said CGT was the largest union at EADS’ French facilities.

An Airbus spokesman in the US, Clay McConnell, said that CGT’s view actually supports the EADS position that the KC-45 tanker will be built by Americans, contrary to the claims by Boeing and its supporters that the KC-45 will be built by Europeans. McConnell called the CGT’s position a “tempest in a teapot.”

“Any concerns voiced by this particular union (a minority one within the company) about Airbus’ growth in Mobile only underscore the fact that the KC-45 will be built there by Americans. Furthermore, the reality is that the KC-45 will, in fact, support as many American jobs as the other guy’s tanker would.  Nonetheless, isn’t the competition really about which aircraft the Pentagon judges as the best one for the U.S. Air Force?”

Guy Hicks, EADS-North America spokesman, said, “These guys are all about outsourcing.”

Indeed, the CGT, IAM and SPEEA all have worried about outsourcing and Airbus and Boeing establishing production lines outside their home countries or Washington State. Each has expressed concern over quality control and loss of technical knowledge at the core competency.

Airbus and EADS say that majority of the Airbus unions support the tanker bid. The debate over jobs is also very similar, with CGT concerned about losing tanker jobs to America if the KC-45 is built in Mobile and the Boeing tanker supporters concerned about losing American jobs to Europe if EADS wins the contract.

EADS and Boeing each claim their tanker will support more than 45,000 direct and indirect jobs in America.

The topic of outsourcing is highlighted in the following two items that coincidentally surfaced this week, entirely unrelated to the CGT visit to Seattle. The first is this 20 page study about engineering outsourcing by Accenture. Free registration is required to download it.

The second is an interview in The Engineer magazine with Charles Champion, of Airbus.

What is the effect of CGT’s position? Effectively, nil. The USAF won’t pay attention to it. Airbus and EADS will, like Boeing, put assembly lines where ever they see fit. But this might become yet another talking point on both sides in the continuing PR campaign.

14 Comments on “French union understands “Buy American” on tanker

  1. CGT stand for Confédération Générale du Travail (US: General Confederation of Labour) and indeed is historically linked with the communist party (and still is.

    Their approach is not to defend the company but their benefits, this at all costs.

    • The CGT has evolved a lot since the last few decades. And blaming them or accusing them of having ties with the Communist Party (remember this is an insult to be accused of “Communism” in the US, while it’s certainly not in France) is beeing very short sighted.

      As of now, the CGT is much more progressive than it was a few years back. It nearly cost their “board of directors” their seats during the last few CGT elections.
      As of now, the CGT is not in a situation of a blunt opposition (say a simple “no” to everything) to whatever the corporate direction says, but more in a situation of a cooperation with the direction to find a solution that benefits all (they tends to say a more complex “yes but” or “not like this but we might agree with this”.)

      So, no, the approach of the CGT is not to defend their benefits at all costs (well, do you know any labour that don’t defend their interests more than the rest ?)

      The CGT is now surpassed by Sud (South) on the extremists positions (the deny all position), and is much more aligned with the Social Democrats labour unions like the CFDT or CFTC.

      By simply taking into consideration the comments of the Airbus/EADS officials and not understanding the labour situation in France, any comments is going to be deeply flawed.

      Side final note: the CGT is structured in many small unions, hence the Confederation. Any group of workers can structure themselves in a Union branch affialiated to the CGT and defend different opinions than the core union.

      However, and in my opinion, the “bal des faux culs” that plays both the french media, political sphere and unions in this game is kind of disgusting. They do indeed promote “French products” for the State tenders, but now feels that the US should buy a European product.

      Nevertheless, the situation of the European tenders tends to be much more opened to the international competition (or subcontractors competitions), while the US tends to protect their industrial base (including the subcontractors). So the US are in my opinion in a very different situation as we are in Europe. And shouldn’t really be in a position to call the KC30 a “European” product anyway as their procurement implies a huge part of American subproducts.

      (For the sake of transparancy, i’m French for those who wouldn’t have got it by now).

  2. This is an unusual new twist in the continuing KC-X Battle. Apparently unions in France support their fellow union members in the US.

    This is a major blow to EADS, their own labor force does not support them for the new USAF tanker.

    • Spoken like someone who knows nothing about French labour politics. 🙂

      The CGT is pretty irrelevant. Hard-core communists, old-style labour organisers, with no base beyond some no-hopers, and they were conclusively defeated in the 2007 transport strike.

      http://en.wikipedia.org/wiki/November_2007_strikes_in_France

      Only about 8% of the French labour force are union organised. The unions only care about protecting their benefits, and the jobs of the union officials, and not in that order.

      Keep dreaming.

    • apparently Communists and Boeing hold similar views… that is interesting

      No seriously. This CGT is NOT like IAM or SPEEA. It’s one of many unions (the commies are the ones that face competition, isn’t that nice), not like the BA unions at all

  3. Stating, “Airbus and EADS will, like Boeing, put assembly lines where ever they see fit,” is an over simplification at the very least.

    Airbus and EADS management’s “fit” includes a very strong political component from each of EADS’ controlling government stockholders. We cannot forget the continual strong arguments between the Germans and the French for locating factories in their respective regions. The overall A380 sub and final assembly locations yielded a compromise we see today, plus a promise Germany will have all final assembly for the A320 follow-on aircraft.

    Today, the UK, via BAE, are no longer part of the original EADS sharesholder group. It can be easier to move move UK EADS factories to the continent. During the A400M support negotiations, as the UK faltered in financial support, Spain was very interested in moving tooling from the UK.

    Any such action, however, has its risks. A UK without EADS can be a threat to EADS’ dominant aerospace role in the EU (BAE’s Taranis UCAS represents a small part of this competition).

    The KC-30 MRTT tanker assembly factory strategy have this political component as well. Outsourcing systems integration to the various customer nations may not be ideal from an effective and efficient manufacturing perspective, but it assists each customer’s political position.

    So, locating, “assembly lines where ever they see fit,” includes a good political component with convenience and cost.

    • Building an assembly line in China didn’t get all that much opposition 😉
      Started in 2006/7 first roll out was in 2009, current production targets 4 a month.
      No quality issues reported.

      So EADS/Airbus seems to have the planning competence and didactic
      abilities to set up shop elsewhere.

      • Yes, the “fit” in China was a good compromise. Large A320 assemblies are still created in Europe, yet the Tianjin final assembly plant guarantees sales in-country. It also is a good-will gesture albeit with an older airframe; a very political decision at the highest level.

    • “Any such action, however, has its risks. A UK without EADS can be a threat to EADS’ dominant aerospace role in the EU (BAE’s Taranis UCAS represents a small part of this competition).”

      How so? I can not see BAe or indeed any other UK company get back into manufacturing civil airliners. Helicopters are already manufactured in the UK at Agusta-Westland, and the same goes for smaller military planes. But as long as nobody gets into producing a complete range of mainline airliners in Europe EADS will remain dominant by default.

      • Yes, today it’s difficult to see BAE building civil airliners, but not impossible. They “can.” And, not being tethered to the mighty EADS (and their respective governments) makes it possible.

        EADS has reduced and will continue to reduce work in the UK, as without ownership or significant purchases (mil or civii), other EADS governments will extract more. So, given reasonable market conditions and cost, the UK can invest to fill the void.

        No less, the UK have the skills in the most critical aspects of aircraft design: the wings & engines. In these areas, they have especially wide-body experience, large wings and large engines.

        Can we imagine a joint development of a wide-body (or whatever it’ll be called by then)? Bombardier may be a willing partner.

  4. Unions tend to support the status quo. As long as their members – existing employees – maintain their benefits, they don’t care what happens the company or new employees.

    So, I imagine unions in Europe have mixed feelings about Mobile. If a potential US Government contract supports their jobs back home, all well and good. But they will feel very negatively about Mobile taking over work they used to do.

    The US Airforce should choose their next tanker on its merits. I don’t have a stake in that decision.

    However, I am surprised by the number of Americans who are fiercely opposed to Airbus setting up operations in their country – seeing them simply as a Trojan Horse. I would have expected them to welcome the major other Aerospace company investing in their country and aerospace jobs – in a sector that is one of the USA’s key strengths. Apart from anything else, it compensates for outsourcing going the other way.

  5. For information, the CGT leader (Mr Thibault) is a member of the Communist Party since 1987. In French : http://fr.wikipedia.org/wiki/Bernard_Thibault
    The CGT fears that Airbus outsources jobs to the US. It’s obviously not a blow for Airbus, but for Boeing statements concerning american jobs which would be involved in KC45 and A330F manufacturing.

  6. Perhaps the CGT understand that if EADS wins the KC-X competition (again,) that Airbus will take the opportunity to build a final assembly line in the US, staffed by non-French, to build the A330F.

    From their point of view, a Boeing win means jobs remain in France.

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