Spot the difference

Written By: - Date published: 4:35 pm, April 17th, 2008 - 33 comments
Categories: workers' rights - Tags:

Hmm, spot the difference in the headlines of two press releases out today:

‘Fisher & Paykel Appliances Announces Global Manufacturing Strategy’

‘Next Steps in ANZ National’s business transformation’

Cut out the weasel words and what is the net result 930 fewer jobs in New Zealand.

The two companies involved, Fisher & Paykel and ANZ National, can hide all they want behind words, but their actions should be seen squarely for what they are a move to shift their business operations to countries where they can exploit cheap labour conditions.

F&P’s “global manufacturing strategy” and ANZ’s “business transformation” is about cutting costs and increasing profits. They should just say that.

F&P’s after tax profit last year was $61 million. ANZ’s was a whopping $1.168 billion. Both companies can afford to keep this work in New Zealand, but chose not to, in the pursuit of a quick buck.

– From a reader.

33 comments on “Spot the difference ”

  • Comments are now closed

  1. IrishBill 1
    17 April 2008 at 4:51 pm

    I note F&P shares are “heading for their biggest ever one day gain”.

    http://www.stuff.co.nz/4484792a10.html

    There are three million children in indentured labour in Mexico.

    It’s days like these I’m reminded of why I don’t want the market left in charge.

  2. Billy 2
    17 April 2008 at 4:57 pm

    So your answer IB? Legislate that F&P have to provide a certain number of jobs?

  3. Jay 3
    17 April 2008 at 5:16 pm

    Obiously this poster is unfamilar with why F&P are moving these jobs overseas – because they are getting killed by the high exchange rate which is a function of having higher interest rates than other countries. They simply can’t compete with companies based in the US who have a massive cost advantage due to a favourable exchange rate (USD).

    It’s not a matter of exploiting cheap labour but of corporate survival. Look at share price of any export company in the last 18 months like pumpkin patch, F&P Healthcare, Rakon, Sanford which are down because their profits are being screwed by the high NZD.

  4. Tane 4
    17 April 2008 at 5:25 pm

    Jay – while the high exchange rate driven by our Reserve Bank’s myopic focus on inflation is a problem, F&P is not uneconomic.

    Last financial year the company made $61 million in after tax profits. They’re not leaving to ‘survive’, they’re leaving because it’s more profitable to operate in a country where workers are paid peanuts and trade unionists are shot.

    The cost savings will be taken directly out of their workers’ pay packets and working conditions. It’s not pretty, but that’s international capitalism for you.

  5. Santi 5
    17 April 2008 at 5:35 pm

    “It’s days like these I’m reminded of why I don’t want the market left in charge.”

    Your personal likes or dislikes are irrelevant, Irish. The fact is the market economy and capitalism rule the world and thanks for that.

    Just go to a corner and weep…..

  6. Tane 6
    17 April 2008 at 5:38 pm

    And it’s times like this I’m glad Santi isn’t in charge of anything. Unless he’s Murray McCully…

  7. Jay 7
    17 April 2008 at 5:44 pm

    We should really define uneconomic here.

    What you are giving is an absolute number which sounds great $61m but what you should really be focusing on is return on investment and return on shareholders equity. If they aren’t comparable to what investors can earn on other assets – domestic or international – then its simply not worth the risk to invest in. So what I am saying is that it is uneconomic compared with other financial opportunites that they could be investing. FPA is competing for capital and investor confidence. If they don’t perform and deliver then its going to end up like bear sterns.

    http://www.scoop.co.nz/stories/PO0804/S00273.htm

    If you read the rest of the article the CTU admits the exchange rate is a problem.

    Disclosure: have owned several of the companies listed so I give a shit about their performance.

  8. Billy 8
    17 April 2008 at 5:53 pm

    Jay, stop talking perfect sense. It’s $61m I tell you! While the workers are starving.

  9. Robinsod 9
    17 April 2008 at 6:11 pm

    Billy you nasty little shit. You’re doing a real good job of being a house-slave. When your wee firm folds don’t come crying to me.

    [lprent: ‘sod. Keep the personal abuse down]

  10. barnsleybill 10
    17 April 2008 at 6:19 pm

    Tane, you mention the reserve bank’s “myopic focus” on inflation, while we could argue until the seven circles of hell are reborn about why the government spraying our money around like a mad ladies piss is the biggest cause of inflation……… let’s not.
    Why not get your boss to call Harry and ask for the reserve bank’s LEGISLATED operating parameters to be changed?
    F and P have decided that manufacturing here is just too hard. it is not just the cheap labour that will have led them to this decision, trading conditions are harder and unfriendly legislation for employers will see many more make this move.

  11. Billy 11
    17 April 2008 at 6:20 pm

    ‘sod:

    1. You needed an apostrohe after “Billy”.
    2. I am not nasty. About this, most people who have met me are agreed. Stop trying to fit me in to your prejudices about right wingers. Some of us are very caring. We just don’t think the state is the best answer to every problem.
    2. I am not little.
    3. I can be a shit, but I am not being one right now. You, on the other hand seem determined to behave badly at every opportunity.
    4. If you want me to fuck off out of here, just say the word, and I’m gone.
    5. My firm may fold. If it does it’ll be down to me, and I won’t go crying to anyone.

    [lprent: yep – language. Don’t let the ‘sod provoke you and you won’t get moderated]

  12. Billy 12
    17 April 2008 at 6:21 pm

    6. I can’t count.
    7. Why is my comment in moderation?

  13. Jay 13
    17 April 2008 at 6:27 pm

    “When your wee firm folds don’t come crying to me.”

    Why, are you a winz case officer?

  14. lprent 14
    17 April 2008 at 6:32 pm

    Billy: Either language, or your IP is in the same range as someone we don’t want on here.

    We usually move messages in moderatioin out pretty fast. If it is an IP, I remove them when I stop hearing the barbarians hammering on the door.

    Dean had the worst one – he shared an IP range with d4j for months.

    Lynn

  15. Tane 15
    17 April 2008 at 6:49 pm

    Btw, the language isn’t cos we’re prudes – we’ve just been getting a lot of filthy pornographic spam that I’d rather not have show up on the front page.

  16. Robinsod 16
    17 April 2008 at 6:55 pm

    Sorry Lynn.

    Billy – anyone who snidely gloats over a thousand people losing their jobs (including some people I know pretty well) suits the term “nasty” IMHO.

  17. lprent 17
    17 April 2008 at 6:56 pm

    I think I figured out the spam backdoor last night. Looks like it came in with a plugin that was tested a while back. It’d attached itself to the footer code.

    I removed it, so I’ll have a look to see if anything is getting past the recaptcha or if I have to keep looking.

  18. barnsleybill 18
    17 April 2008 at 7:10 pm

    Rob these people have lost their jobs because NZ inc is unable to compete, a double tragedy that F & P are closing Dunedin. A place that rivals palmerston north as a place to escape from. When we have a govt determined to squeeze every last drop of goodness from the productive so they can continue to buy the favours of the unproductive we will continue to lose jobs off shore.

  19. Robinsod 19
    17 April 2008 at 7:17 pm

    Bill – these jobs are being lost because Mexican workers can do them for $2 an hour and that means FandP can make an extra $50m a year. Please explain how we should compete with those labour costs. Oh that’s right the productive workers at F and P should have tax cuts so that $2 an hour becomes enough to live on, right?

  20. Billy 20
    17 April 2008 at 7:29 pm

    ‘sod, why must you relentlessly behave like such a dork? I was not “snidely” or otherwise gloating over anything, just pointing out that Jay was completely on the button when he pointed out that it is dishonest to blithely say F&P earned $61m if you are not going to compare it to the investment made.

    I used to have a soft spot for you. But now you are just tiresome. And sanctimonious. And self-important. And, oh, boring.

  21. Robinsod 21
    17 April 2008 at 7:43 pm

    Sanctimonious? Ha! I think that’s the first time I’ve ever been called that! Perhaps I should make a joke about your mum or something?! Not that I’d ever do that as she is, after all, a lovely woman and I have a lot of respect for her and for how she has managed to bring up such a fine example of, um… what exactly are you again?

  22. Billy 22
    17 April 2008 at 7:49 pm

    You’re dead to me…

  23. Tane 23
    17 April 2008 at 7:58 pm

    I hate watching you guys fight…

  24. Paul 24
    17 April 2008 at 8:00 pm

    Sorry guys welcome to the world of manufacturing in 2009.

    The right bemoan the wage gap with Australia, but in all reality F&P can not compete with $10 a day in Mexico, add to that the high and stable dollar and other issues like increased costs in manufacturing general and you have a no win situation.

    It is a tragedy for the 430 workers in Dunedin, but apart from that it’s actually a good story. Apple computer as much as they are a manufacturing tech industry are as much a design entity. They are as Californian as the Beach Boys, yet 99.9% of their manufacturing is done overseas (Taiwan and Mainland China mainly), yet they are American and uniquely so. F&P now need to take the manufacturing advantage they will undoubtedly get from operating in Mexico, and use the resources of the engineers and designers in Dunedin to take their business to the next level. F&P now need to become the Apple of the white-ware industry, the best design with the best function, appealing to high end consumers, bringing filthy overseas dollars back into NZ, remember head office isn’t going overseas like other ‘NZ’ businesses.

    barnsleybill you are about as far off the money as one could be. This is not a govt issue, if it is then the US and Australia have exactly the same problems and then their govts have to go to. Dunedin will not close, and that jab about escape from Dunedin is well just dumb. We moved here 9 years ago, and since then I have had a dozen friends move from Auckland, Wellington and ChCh all to Dunedin – but that’s another issue.

    As for the ANZ issue, again they aren’t being sacked. IF we are to take ANZ at their word, they are actually going to increase services and their workforce, but undoubtedly (as has already been demonstrated) this isn’t a scary enough story for the media and they are playing the ‘asian call centre’ card.

  25. Jay 25
    17 April 2008 at 9:00 pm

    “Apple computer as much as they are a manufacturing tech industry are as much a design entity. ”

    True true. Why anyone would want to own some ugly-ass piece of crap PC clone is beyond me when they could purchase the glory that is the macbook is beyond me.

    As well as 99% of the manufacturing being done overseas the Chinese were complaining that bulk of the profits, about 95% were going back to the Apple.

  26. Stephen 26
    17 April 2008 at 10:08 pm

    If they had the choice of using cheap offshore labour this month, why didn’t they exploit that choice YEARS ago???

  27. Robinsod 27
    17 April 2008 at 10:31 pm

    They’ve been moving toward this for years. Do you think they just logged onto Mexican trade me, found a factory and hit the “compra ahora” button?

  28. Lyn 28
    17 April 2008 at 10:54 pm

    “Compra ahora”?

  29. Lyn 29
    17 April 2008 at 11:01 pm

    Buy now…of course. Duuuh

  30. lprent 30
    17 April 2008 at 11:04 pm

    Buying now ? At least according to google translation from spanish

  31. Draco TB 31
    19 April 2008 at 11:29 am

    The fact is the market economy and capitalism rule the world

    For now. Don’t expect it to forever because, quite frankly, it’s a failed system. Any social system (capitalism is a social system not an economic one) that requires the vast majority to live in poverty and a significant portion to live in abject poverty is a failed system.

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