On Tuesday, February 19, the French newspaper Les Echos triggered a clash between the French government and the tire company Titan with the publication of a polemical letter from its CEO, Maurice M. Taylor, Jr., known as “the Grizz.” In the letter, Taylor, former candidate for the Republican nomination in 1996, criticized the workers of the Goodyear factory in Amiens, a factory that is has fallen on difficult times and threatens to close.
Titan was for a while considered as a possible buyer for Goodyear, before it decided to withdraw its offer. Nevertheless, it was is not from this decision that the controversy arose, but rather his tone in justifying it in the letter sent to Arnaud Montebourg, Minister of Productive Recovery, on February 8.
“I have visited that factory a couple of times. The French workforce gets paid high wages but works only three hours. They get one hour for breaks and lunch, talk for three and work for three. I told this to the French union workers to their faces. They told me that’s the French way (…) Sir, your letter states that you want Titan to start a discussion. How stupid do you think we are?”
Taylor referred to Goodyear’s employees as “so-called workers,” predicting, “within five years, Michelin would not be able to make tires in France.” Indeed, undergoing a constant slow down of some of its activity, some parts of the Goodyear factory could only work for a few hours everyday, the factual basis of Taylor’s sweeping accusation.
Montebourg’s response was of a similar tone: “Your words, extremist as well as insulting, show a perfect ignorance of what our country is.” With statistical proof, Montebourg intended to prove to Taylor that foreign companies kept investing massively in France (some 20, 000 do), which leads to job creation (2 million). Even though the details of the figures could be discussed, Montebourg’s retort is confirmed, at least in its broader features, by the report of the French Agency for Foreign Investments, the only source on that regard.
Montebourg’s words were worthy of his reputation as a pugnacious politician. He belittled Titan, writing, “Titan (…) is twenty times smaller than Michelin, our French technological leader [in the same industry], which has an international influence, and thirty-five times less profitable.” Nevertheless, an accurate comparison of the profitability of the two companies is a perilous exercise, contrary to Montebourg’s assertion. Montebourg concludes with a threat to “watch” very closely the importation of Titan’s tires.
Later, Taylor took full responsibility for his words during interviews, asserting that “soon, in France [there will be no jobs] and everyone will spend his day sitting in cafés, drinking red wine.” He maintained that he didn’t mean to insult the French, but only to point out the high cost of their workforce, one of the highest in Europe, not because of salaries but mainly because of the related social services.
According to Taylor, because of those workers “who don’t want to work anymore,” the country is doomed to know the same fate as Greece. The American entrepreneur repeatedly mentioned the fact that Goodyear had announced its closure in January after, according to one its directors, “five years of unfruitful negotiations” with the unions.
On February 22, Taylor answered to Montebourg’s attacks during an interview with the Agence France Presse (AFP), the French Press Agency. He responded by saying it was “his government, which was extremist.” In a new letter, Taylor wrote him that his letter “shows how much the politicians are disconnected from the real problems of this world (…) your government let the crazy men of the communist union destroy the best paid jobs.”
This is a criticism Taylor addressed to all the politicians, beyond the French government alone. Indeed, in his first letter, Taylor had admitted that “The U.S. government is not much better than the French,” referring to a conflict between Titan and a Chinese company, when the U.S. government, according to Taylor, failed to help the American company.
Taylor highlighted the fact that after trying for four years to buy the Goodyear factory in Amiens, he had to give up because of the opposition of the unions. He also stated, “at no point Titan asked to lower the wages. We just said that if one wants to be paid for seven hours of work, one has to work at least six.” Moreover, Taylor did not fail to point out that he holds a factory in Normandy. Finally, he blamed the French government’s labor policies for the high unemployment rate in France.
Laurence Parisot, president of the Medef, the most important union of employers in France, acknowledged that Montebourg was right when he called Taylor’s words “unacceptable.” Parisot condemned the latter’s sweeping statements, making generalizations about a country from a very particular situation that clearly showed “anomalies.” Nevertheless, Parisot thinks that Taylor reveals “anomalies that we must correct.”
There is at least one anomaly that this controversy reveals: Montebourg seems to spend most of his time trying to stop the bleeding in French industry, proving the “Productive Recovery” is closer to a dream than to reality, especially given the desperately slow growth in the French economy.