" Honda car strike in China inspiring workers | Madam Miaow Says

Saturday, 29 May 2010

Honda car strike in China inspiring workers


This is pretty amazing. Honda workers at three plants in China have gone on strike in the carmaker's largest potential market.

A hundred workers at one plant struck on May 17th for more than the current measly $180 US per month, or 1,200 yuan, and want at least 2,000 yuan starting pay. After Honda reneged on an agreement, 1,900 Chinese workers in two other factories came out in force eleven days ago. Honda has just shut down all four plants in Guangzhou and Wuhan despite announcing an aggressive push to boost capacity from 360,000 vehicles to 480,000 by the end of 2011, and by 28 per cent by 2012.

The largest strike ever reported in China is being seen as a warning to other auto-manufacturers in China. There's a lot to play for so the company is digging in its heels. According to the China Daily:
Negotiations were held on Tuesday between executives from all workshops and workers but "due to vast differences, the two sides failed to reach a deal," ... Government agencies and trade unions are also trying to broker a deal ... Ma Qiufeng, a professor in sociology at Guangzhou-based Jinan University, called the strike "good news" because the workers' demand may help China become a more open society.

May I say: about time, too?

One Shanghai-based analyst said:
"Profits in China's auto industry are relatively high compared to mature markets, and there's room for increasing workers' benefits."

In 2006 there were moves to open up the trade unions in China but this came to an end when the American Chamber Of Commerce, backed by the Europeans, lobbied hard against it.

China wants to maintain its national pride as it prepares to take Number One status among the world powers, but it can hardly do that if its workers are expected to man the lowly sweatshop of the world. We've already had the scandal of the spate of suicides at the Foxconn Apple and Dell factories. Not only that, but if you want your workers to be able to consume your goods, you'd better pay them well, even if capitalist consumerism inevitably leads to slumps (Marx's Das Kapital, innit?). Expect to see improving standards as when the West gained its own superior economic power. We may yet see British workers trying to join the Chinese workforce in a case of "Zai Jian, Pet".

Hong Kong labour activists push for iPhone boycott

Thanks to Denis for this Han Han link on the suicides: Han Han (韩寒): The Bloom of Youth

28 comments:

Gwei Mui said...

Interesting, I look forward to further posts on this subject

Mr. Divine said...

Is $180 a month measly in China?

Madam Miaow said...

Per month? Yes, 1,200 yuan ($150-180) is pitiful. Even the suicide factory pays 2,000 yuan pm

Sue said...

I had posted a link to the NYTimes article on this strike before I saw your excellent blog posting. The Times notable point was how impacted the Walmart et al companies known for cheapo products will be if Chinese workers organize and force them to pay a less exploitative wage.

Madam Miaow said...

Hi Sue, which is your blog? Could you post a link here?

Cheers.

Sue said...

Sure!
Sue Katz: Consenting Adult
www.suekatz.typepad.com

Avrilll (Bov) said...

This is very refreshing to read. Power to the People I say...
I wish them success.

thanks for your excellent blog MM.

neprimerimye said...

The most interesting aspect of this struggle is that the official state run union is playing a role representing the workers involved. I note this as there have been indications in the recent past that this is happening.

Given that these unions are state controlled it can be assumed that the state view struggles waged against foreign companies in a different light to those waged against Chinese capital.

But even allowing for this national twist what we are witnessing is the disarticulation of one sector of the state machine, the unons, from the state as a whole. Thje reason beingn that those bureaucrats who run the unions have an interest in 'their members' receiving wages that can then pay the wages of the bureaucrats. Just as in this country. Moreover I suspect that the union bureaucrats are to some considerable degree excluded from reaping the profits of privatisation in the same way as others sectors of the overall state bureaucracy.

Madam Miaow said...

At least workers' conditions are set to improve for a while as they did in the West. Then the workers will get more confidence and then who knows? I hope they do better in the long term than we did.

Mr. Divine said...

But isn't $180 per month a lot of money in the more rural areas were wages (if work can be found) is as little as $25 per month. So in comparison to rural workers these car workers are well off?

I know we don't think of $180 per month being much but for many third world people that's quite a bit of dosh. And they are willing to take the place of these striking workers.

Madam Miaow said...

These are not rural workers, though. They are the motor of what is set to be the biggest industrialised country in the world.

Prices in the cities are not far off the same as ours — have you seen Shanghai? Hong Kong property is more expensive than in London. Honda made nearly £1 billion in the final quarter of last year.

Forty quid a week is a joke.

Madam Miaow said...

Ha, not even forty quid. More like £30 per week.

Mr. Divine said...

First of all it isn't a Honda factory, it's a joint Denway Honda venture. Denway Motors are owned by Dongfeng, the state owned motor company and partly by Guangzhou municipal government. So the strikers are striking against government owned entities as well as a Japanese car company.

And the plants are in Guangzhou where property prices are not in the same league as Hong Kong or Shanghai. According to the Financial Times the workers are currently getting $220 per month. The monthly minimum wage in nearby Jiangsu is $140 per month. Average wages for mechanics are only $180 per month.

I'm not saying that the car workers are rich but i am pointing out that firstly it is the state and local government that partly owns the company and distributes that wealth to the rest of the community, and secondly that the workers are being paid more than other workers, in fact substantially more.

Madam Miaow said...

It's a Honda operation. Read the press. The state may have an interest somewhere along the line but this is essentially a foreign owned factory. Personally, I don't think it matters who's exploiting you, only the fact that you are being ripped off for low wages.

You measure against the lowest, I measure against the highest and the huge profits being made.

The workers' wages are not enough to buy a home or partake of the new wealth in society. I don't know why you are siding with the rich, Mr Divine. Do you have a trust fund or something?

Mr. Divine said...

No it's not a foreign owned factory. Its Denway Motors, its listed on the Hong Kong stock exchange (203) and pays dividends. Other foreign car firms have joint ventures with China companies. Please don't think it is just Honda. In your press source it may say only Honda but that's not accurate because Honda does NOT have sole ownership of the company. It is jointly owned .. really check it out and don't just rely on one press source. You will find that I am writing the truth. Its a joint venture Denway Motors Honda. it is not essentially a foreign owned firm as you claim.

But the workers wages are enough to buy a house in a rural area. Many of the workers are housed in the firms' dormitories and some come from rural areas where houses are very cheap. They earn well above average wage and miles beyond what rural workers earn. And they can save a portion of their income, some no doubt being able to buy houses in rural villages.

Sure China is making profits. But what is good for the whole and not just for a group of above average car wage earners? It must not be forgotten that China is still a poor country so there isn't that much to go round. The Chinese Communist state and municipal governments uses the Denway Motor profits for the good of all the people. Why should the representative government give way to these few richer workers

Madam Miaow said...

With at least 6,000 yuan billionaires in China and a growing wealthy middle class, £30 per week is not enough. How much to the directors of

I'm not sure what point you are making about factory ownership. These are Honda's Chinese plants. Whether it's the state or Honda or a combination of both, I'm pleased o see the workers standing up for themselves. Aren't you?

As for ownership, you'll have to take up the issue with the following sample of press reports including this one from the FT:
http://www.ft.com/cms/s/0/e27a832c-6944-11df-aa7e-00144feab49a.html

http://www.nytimes.com/2010/05/29/business/global/29honda.html?src=me

http://chinadigitaltimes.net/2010/05/honda-strike-becomes-a-rallying-point-in-china/

http://news.bbc.co.uk/1/hi/business/10172345.stm

Sue Katz said...

You, MM, have the patience of a saint. "You measure against the lowest, I measure against the highest and the huge profits being made." Well said.

Mr. Divine said...

Read this article: http://www.clb.org.hk/en/node/100771

it clearly states that Honda and Denway Motors are a joint venture.

The workers in my mind are striking not because $220 per month is not enough to survive as you suggest. Like everyone, they think they deserve more. I know that there millions of people who are worse off than car workers in China.

Am I pleased that they are standing up for themselves? Not really. Why should I be pleased that richer workers want more money? I would be happy if they announced that part of their wages would be donated to much poorer people in the rural areas.

Madam Miaow said...

"it clearly states that Honda and Denway Motors are a joint venture. "

Yes, in an article that calls the plants "Honda" throughout.

You think £30 per week is a fair wage in a country about to become the world's wealthiest superpower? Jeez!

Mr. Divine said...

It calls it Honda throughout because its shorter and easier than trying to explain the link. It is slightly misleading. But the financial link is undeniable.


Actually $220 per month is about 36 quid a week. I know it doesn't sound much to someone in England but in rural China it is an excellent wage. In places like Gansu and Kansu and even further coastal Shanxi a reasonable house can be got for as low as 3,000 quid.

If the car worker shares his accommodation with say 10 others in this room and eats his own food and doesn't 'spend' I reckon he could easily save 25 quid a week Remember he may also do overtime and/or work a second job. Still if he saves he'll be able to buy over a half a house in a rural area in a year: 25 quid times 52.

That is big purchasing power. So he buys the house borrowing half the money and puts in a tenant who pays the interest and a bit more. Next year he does the same. Within ten years with inflation he's made big time. He can live easily on the rents of at least 7 fully paid up houses.

What do you think is driving China's housing boom? Its the richer workers trying to become rich by the housing piggy back scheme. I wouldn't be surprised if there weren't some ex car workers amongst the property tycoons.

Mr. Divine said...

The Chinese economy may be a power house in terms of the size of its GDP but in terms of GNP per capita its poor. Its poverty is a direct result of the economic ineffectiveness from 1949 to the 1970s. During that same time span Japan boomed and easily outpaced the cumbersome Chinese state run economy. Japan's technology whether be in cars or in other products is now helping China to raise its standard of living.

Madam Miaow said...

This isn't in Gansu, though. It's in south eastern China which is much wealthier and developing along the lines of the West.

In terms of GDP it is poorer — one reason they aren't asking for Western worker rates of pay — but growing massively. The principle should be that workers share in the bounty as they actually make the stuff. Even £36 is an insult. It is not enough to buy a modest flat. And not enough to buy the cars they are building.

I think also that they work ten hour days, six days a week?

How much do the company directors make?

This is a country where spoilt princesses ride around in Lamborghinis done up like Hello Kitty. An increasing wealth gap is a dangerous thing.

Mr. Divine said...

No Gansu lies next to Kansu in the northern western areas. What are you thinking of?

Well I think I just demonstrated to you that 35 quid can go a long way in some rural areas of China if the worker is prepared to forgo luxuries and save. When I first started work it was about 25 quid a week, So what? It is relative to what you can do with the money in the country you are in, and I've just demonstrated how it is possible for a Chinese car worker to buy a number of houses in a short space of time. Do you have problems with the figures or the logic?

Of course there are other people that are richer but in comparison to a rural worker a car worker is much better off, and has the opportunity to be relatively rich.


What if the yuan exchange rate wasn't pegged by the Chinese government? Well for a start, the yuan will appreciate and may even treble in value to the pound. Consequently the worker would then be earning 108 quid a week! Sounds great eh .. nay. Ultimately the worker still has the same purchasing power, a power that is over ten times that of a rural worker. In the eyes of a rural worker a car worker is a rich person. The ability to become rich (and this in fact is now glorious) is clearly with the car worker. He has over ten times the income of a rural worker and can use his savings/excess wealth to obtain rent.

They only work ten hours a day? So that gives them another 6 hours for a part-time job. Seriously. I know because I've been there. You can work 16 hour days for quite a long time if you're motivated enough.

Disparity of wealth is great. Look at Nicholas van Hostrothen.

Madam Miaow said...

I know where Gansu is. The factories are the opposite end of the country in the south east.

Mr Divine, are you stoned? Or bored?

Mr. Divine said...

Gansu province is next to Kansu. Cities include Wuwei, Shandan and Zhnagye. Look at it on the map.

Bored or stoned? What are you on about? I clearly demonstrated to you that a car worker on $220 a month can accumulate housing in rural areas and that is your response. I know about real poverty you don't.

Madam Miaow said...

Only you keep mentioning Gansu. Guangzhou is in south east China. Where all the factories are. And the expensive cities.

And you're making personal assumptions about me. Not correct and not welcome.

Back of the class, Divine.

Mr. Divine said...

I'm not making a personal assumption about you. I know that you don't understand poverty. You think 35 quid a week is pitiful when in fact it is not. I have demonstrated that 35 quid if properly used in China can produce a property portfolio. And there is nothing wrong with the logic of my argument.

You are suggesting that I'm stoned and/or bored which are definitely personal assumptions and could if I was so inclined/insulted/ultra-sensitive/closed minded be filed in the troll/insult file.

But I'm very opened minded about other people's assumptions/remarks/insults: in fact much more so than you. Especially when I've had a couple of cones.

Madam Miaow said...

I'm afraid you are still making the same assumptions.

You've been trolling on this website for a year or so now, seeking attention, picking fights, making stupid comments, many of them sexist. You insult my female friends.

Any wit you once had has gone. I'm deleting further comments from you.

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