Caterpillar threatens the future of thousands of Belgian families


The imposing Caterpillar construction machinery plant in Gosselies, on the outskirts of the city of Charleroi, appears to be running idle. The workers are on site but are refusing to go back to work. Brand new diggers are blocking one of the entrances.

A few metres away, crosses have been erected to symbolise the funeral of the manufacturing site. On each of them, workers have inscribed their starting date at Caterpillar and 2 September 2016, the day on which the financial director of the US multinational, Mark Thomson, travelled especially from Illinois to announce the plant’s closure.

The measure is expected to lead to the redundancies of no less than 2200 workers by 2017. When adding the workers employed by Caterpillar’s subcontractors, the number of Belgian families at risk rises to between 5000 and 7500.

Production is to be relocated to other facilities already in operation, such as the Grenoble plant in France.

Ten days later and the mood is still very sombre in Gosselies. A group of workers are gathered around a mobile fries cart, under the blazing sun, in front of the factory. They are having a cold drink, biding their time a few hours ahead of the general meeting (GM) at which they will vote on whether to go back to work.

A big, lively fellow with a full beard is at pains to hide his puzzlement. “We were doing top quality work here. There is no economic logic to this decision,” he laments. Jean-Marc had already survived restructurings in 2007 and then 2013, the year when 1600 jobs were cut at the plant.

The trade unions had, at the time, secured a commitment from the company to keep the plant open until 2020.

“I thought I was a number at Caterpillar, but I’m not even that. I don’t exist. I’m not worried about myself, I’m close to pension age and I’ll get early retirement. But what about the young ones? What are they going to do? They tell us: you’ll find another job. But there are 400,000 people that are unemployed in Belgium! We absolutely have to keep it open. It can be done,” insists Jean-Marc.

Serge, a maintenance engineer who belongs to the FGTB’s metalworkers’ division, finished his shift at 6.42 a.m. Despite the lack of sleep, he was determined to be there. He has been working at the plant for over 20 years. His father also worked there, from 1976 to 1988.

For him “the announcement was incredibly ruthless. We, as workers, were the last to be informed. Everything is decided behind our backs,” he protests.

“Even during the GMs, not one member of the management is ready to come and face up to us. They’re cowards. The least they could do is come and reassure these families. One of my colleagues has eight children. He’s the only person working in the house. His wife hasn’t spoken to him since the closure was announced. There’s going to be a great deal of distress in the region. And the American bosses will wash their hands of it.”


US$1.6 billion in dividends

Caterpillar, meanwhile, is saying it needs to close the Belgian site because the costs are too high. Its argument is that the facility is too big and the company needs to reduce its manufacturing capacity.

Opened in the mid 1960s, Caterpillar Gosselies covered markets stretching as far as Africa and the Middle East until the mid 2000s. Since then, its customers have been limited to Europe and North America. Gosselies has therefore been hit by the fall in demand in the Old Continent over recent years.

But Caterpillar is by no means a struggling business. Although the company announced a 16 per cent fall in turnover during the last quarter, it still amounted to US$47 billion for the year 2015 as a whole. And its operating profits were US$3.25 billion.

Since 1 January, its share price has climbed by 20 per cent and dividends have risen by 65 per cent over the last four years. Some US$1.6 billion dollars were paid out in dividends during 2014. Bill Gates alone collected US$30 million.

And whilst the shareholders rub their hands, the consequences for the workers are grave. In addition to the lay-offs (Caterpillar Charleroi employed 5,500 workers in 1989), the rationalisation measures of recent years have had a direct impact on the remaining employees’ working conditions.

Bernard, now retired, used to be in charge of the bulldozer finishing line. He recalls a painful episode. “In 2012, they had me do a week’s training. They called it the Caterpillar Product System, a method brought from Japan. Being taught how to use a torque after 40 years in the trade, it’s demeaning. They installed a cord above my workstation. I had to pull it if I needed to leave my post to go for a pee, and my boss knew about it immediately. It was like going back to the time of the Charlie Chaplin film, Modern Times.

“They then progressively extended these practices to all the assembly lines. The management had become too aggressive. Before, we at least had the time to chat with a colleague for a couple of minutes or to smoke a cigarette. Caterpillar was my life. It is we, the workers, who made the factory. They, they have just destroyed it.”

He admits to having cried in front of the television when he saw the news on 2 September.


European industry under threat

“Charleroi had agreed to do everything it could to close the competitiveness gap, to the extent of becoming as competitive as factories in China or Japan,” explains Benoît Gerits, deputy general secretary of IndustriAll, a global union defending the rights of workers in the mining, energy and manufacturing industries.

In addition, Caterpillar has long profited from the fiscal largesse Belgium extends to big companies.

Thanks to the notional interest deduction, a well-known fiscal niche, the US multinational has been able to avoid as much as €150 million in taxes, according to the Belgian political party Parti du Travail de Belgique (PTB).

Worse still, perhaps, the Belgian daily newspaper Le Soir revealed, in its 9 September edition, that Caterpillar Belgium belongs to another subsidiary of the group, which is, in fact, based in Switzerland. Thanks to this clever tax arrangement, Caterpillar has been able to cover up a large portion of the business done in Belgium.

The political authorities in Belgium seem somewhat disarmed in the face of this new social crisis, in a country already hard hit by a series of business relocations over recent years.

With regards to the European Union, the European Globalisation Adjustment Fund set up to provide assistance for retraining in the event of mass redundancies, should be triggered.

“It’s all well and good, but it amounts to no more than palliative care. Only the symptoms are dealt with, never the causes. When a company provokes such social upheaval, there should be a law to allow for its expropriation,” insists Gerits.

“It is still possible and crucial that we keep a manufacturing base in Europe. We need to redefine the role of the European Central Bank, which dishes out €60 billion to the bond market every month, fuelling nothing but speculation. We should set up a European investment fund, for example, dedicated to sustainable industries,” he concludes.

In the meantime, in Belgium, the number of collective lay-offs continues to rise. The summer of 2016 saw the announcement of another 4,400 job losses.


This story has been translated from French.