The collapse of the French Shipyard of Dunkirk and EEC state-aid control (1977–86)

Abstract

Since 1958 the European Commission has been in charge of monitoring a progressive reduction of national aid to shipbuilding. However, a large gap existed between theory and practice, especially during the severe crisis that hit Western European shipbuilding from the late 1970s onwards. This article gauges the real influence of state-aid control on companies’ restructuring by examining both the Commission’s papers and the archives of the French shipyard of Dunkirk, which was the second French shipbuilding company in the early 1980s before collapsing in 1986. It argues that the closure of the yard was due to a progressive assertion of European Economic Community (EEC) state-aid control, but also to the company’s internal weakness as well as changes in the French state’s industrial policy.

Keywords:

• Shipbuilding
• European Economic Community (EEC)
• competition policy
• cartel
• state aid

Acknowledgment

This research was conducted while the author was postdoctoral fellow at the London School of Economics and Political Science (LSE) thanks to an EU IEF-Marie Curie Grant.

Notes

1. Smith, An Inquiry, 416.

2. Cini and Mc Gowan, Competition Policy, 162–198.

3. To my knowledge, the sole study based on archival sources on state-aid control is: Eckert, “West German Borderland.” Non-archival based study include Duncan Connors (Connors, “The Decline”) on Scott Lightgow and Vijayakala Seevaratnam on Bremer Vulkan AG (Seevaratnam, Governing the Shipyards); on the assertion of competition policy after the Single Act: Cini and Mc Gowan, Competition Policy, 29–34; on EEC state-aid control in the 1980s, see: Warlouzet, Governing Europe.

4. The five shipyards are: Dunkirk (a town located near the Belgian border, on the North Sea), La Ciotat (near Marseille), La Seyne (near Toulon), Nantes, and Saint-Nazaire (50 km from Nantes, in the Loire mouth).

5. Burton, The Rise and Fall (chapter 10 : “The Long Decline”); Jamieson, Ebb Tide; Johnman and Murphy, British Shipbuilding and Scott Lithgow; Lorenz, Economic Decline; Slaven, British Shipbuilding; oral archives have been gathered in: Murphy and Slaven, Crossing the Bar.

6. Llinares, “Historiographie,” 211; Kocher-Marboeuf, “Chantiers navals,” 120; on Dunkirk, the two lost interesting studies are a master’s thesis on the pre-1973 years (Richard, L’épreuve de la modernité), and a book written by a former engineer at the Dunkirk shipyards (Merck, Histoire des ACF) which insists on the technical aspects; on the port of Dunkirk, see: Marnot, Les villes, 154–176.

7. Seevaratnam, Governing the Shipyards.

8. Stråth, The Politics.

9. Swann, Competition and Industrial Policy; Bussière, “L’improbable politique industrielle,’ 473–4 and “Devising a Strategy,” 268–271; Warlouzet, “Towards a European Industrial Policy?”

10. Llinares, “Historiographie,” 211; Kocher-Marboeuf, “Chantiers navals,” 120; on Dunkirk, the two lost interesting studies are a master’s thesis on the pre-1973 years (Richard, L’épreuve de la modernité), and a book written by a former engineer at the Dunkirk shipyards (Merck, Histoire des ACF) ; on the port of Dunkirk : Marnot, Les Villes, 154–176.

11. The archives of the Dunkirk shipyard, and of the company Normed, are stored in the Centre des archives du monde du travail in Roubaix (subsequently in the footnotes: ANORMED), with the exception of specific files on the last period (1985–1986) which are available in the Archives départementales du Var in Draguignan (AD83); French national archives are stored in Pierrefitte (FNA) and in Savigny-le-Temple (archives of the Ministry of Finance: AMINEFI); the European Union archives of the EEC Commission are located in Brussels and in Florence (EUA); the British National Archives (BNA) are deposited in Kew; the German National Archives (GNA) were deposited in Koblenz for the fund of the German ministry of Economics.

12. The expression ‘The Shock of the Global’ comes from Ferguson, et al. The Shock of the Global; on Europe and globalisation during this period, see Warlouzet, Globalizing Europe.

13. Dobler, Histoire, 65.

14. Strath, The Politics, 5.

15. EEC Commission, Report from the Commission to the Council on the State of the Shipbuilding Industry in the Community, COM (85) 548, October 22, 1985.

16. Strath, The Politics, 5.

17. Richard, L’épreuve de la modernité, 376.

18. ANORMED, 1988.006/21, note of December 8, 1975.

19. ANORMED, 1988.006/2, project of letter to Fourcade, May 4, 1977 (sent on May 12, 1977).

20. ANORMED, 1988.006/15, note Chauchat for Doumenc, November 12, 1981.

21. On the contrast between France and the UK, see Lorenz, Economic Decline, 80–87; on the constitution of British Shipbuilders: Slaven, British Shipbuilding, 217–223; more generally on state intervention in Great Britain, see: Johnman and Murphy, British Shipbuilding.

22. See the internal debates in Margairaz, “L’Elysée,” 101–117.

23. ANORMED, 1988.006/724, Report to the steering committee of the Chambre syndicale des Constructeurs de Navires (CSCN) for the year 1977; ANORMED, 1988.006/111, letter from the Ministry of Economy and Finance, November 9, 1977.

24. ANORMED, 1988.006/2, note on a meeting with Fourcade, July 27, 1977.

25. ANORMED, 1988.006/2, note Chauchat on a meeting with Dupoux, November 7, 1978.

26. ANORMED, 1988.006/2, notes Chauchat, November 7 and 22, 1978; ANORMED, 1988.006/111, note for Chauchat and Lefol, March 2, 1978.

27. ANORMED, 1988.006/2, note Chauchat, October 9, 1978.

28. ANORMED, 1988.006/2, note on a meeting with Fourcade, July 27, 1977 ; letter from Chauchat to Schumann, November 9 1978; ANORMED, 1988.006/111, letter to the Minister, February 8, 1978.

29. ANORMED, 1988.006/2, charter, March 15, 1978; note Chauchat, March 22, 1978; note on the «Comité de direction » of April 4, 1978.

30. ANORMED, 1988.006/2, note on a meeting at the Ministry of Merchant Navy, November 6, 1978.

31. ANORMED, 1988.006/15, note, February 26, 1981.

32. On the difficulties of the 1960s, see Neil Rollings’ contribution in this special issue and Warlouzet, “The Centralization.”

33. Directive 75/432 of July 10, 1975 and directive 78/338 of April 4, 1978.

34. EEC Commission, Ninth Report on Competition Policy, 1980, §157; EEC Commission, Tenth report on Competition Policy, 1981, §183.

35. ANORMED, 1988.006/2, note on the meeting with Fourcade, July 27, 1977.

36. Swann, Competition and Industrial Policy, 173–176; Mény and Wright, The Politics of Steel.

37. ANORMED, 1,988,006/724, Annual report to board of director, June 1980 ; EUA, BDT 323/93/207, note of a meeting held on November 21, 1983.

38. ANORMED, 1,988,006/724, reports of the CSCN for 1978 and for 1980.

39. ANORMED, 1,988,006/725, letter from the EEC Shipbuilders Linking Committee, December 12, 1980.

40. ANORMED, 1988.006/37, note on the CSCN meeting of April 24, 1981 and July 7, 1981.

41. ANORMED, 1988.006/37, note on the CSCN meeting of February 18, and March 18, 1982.

42. ANORMED, 1,988,006/724, reports of the CSCN for 1978 and for 1980, note on the CSCN meeting of January 16, 1980.

43. Report on the state of the shipbuilding industry in the Community: Situation as at 1 January 1980, doc. Com (80) 443 final, September 11, 1980, 1–6.

44. Ibid., 6.

45. ANORMED, 1988.006/15, note Chauchat, July 21, 1981, 1988.006/23, discourse of Le Pensec, October 7, 1981; Todd, Industrial Dislocation. 75.

46. Schmidt, From State to Market?, 51–57.

47. Margairaz, “L’Elysée,” 101–117.

48. Report from the Commission to the Council on the state of the shipbuilding industry in the Community. Situation at the beginning of 1985, doc. Com (85) 548, October 22, 1985, 10.

49. Ibid., 12.

50. FNA, 5AG4/ 4,341, note Mingasson, January 22, 1984.

51. FNA, 1991.0541/ 15, note from the Ministry of Industry, November 25, 1983; FNA, 5AG4/4,341, note Mingasson, January 22, 1984; ANORMED, 1988.006/712, board of directors, meeting of September 28, 1983 and of February 2, 1984.

52. Richard, L’épreuve de la modernité, 197–198.

53. ANORMED, 1988.006/714, meeting of the directors (direction interétablissements), Paris, 16 April 1985; AD83, 48 J 40, meeting of the board of 17 December 1986.

54. INSEE, national census, 1982.

55. FNA, 5AG4/ 4,341, note Sautter, January 23, 1984.

56. Ibid. and ANORMED, 1988.006/713, note Normed, December 31, 1983.

57. ANORMED, 1988.006/714, meeting of the board, June 28, 1984.

58. Richard, L’épreuve de la modernité, 410.

59. FNA, 5AG4/ 4,341, note Mingasson, January 22, 1984.

60. FNA, 5AG4/ 4,341, note Bouchet, January 23, 1984; note Mingasson, January 22, 1984.

61. ANORMED, 1988.006/712, meeting of the board on February 2, 1984; meeting of the DGs on 29 March 1984.

62. FNA, 5AG4/ 4,341, note Sautter, January 25, 1984.

63. BNA, PREM 19/1,325, note Gregson to the Prime Minister, July 27, 1983. On Harland & Wolff, see: Hume and Moss, Shipbuilders.

64. BNA, PREM 19/1,325, note Sparrow to the Prime Minister, July 26, 1983.

65. Slaven, British Shipbuilding, 237.

66. AEU, oral archives, interviews of Richard Burke (2012), Jean-Louis Cadieux (2010), Gianfranco Rocca (2010), Crispin Tickell (2010), Jean-François Verstrynge (2012), available online on the website of the EU archives: http://archives.eui.eu/en/oral_history.

67. EEC Commission, Twelfth Report on Competition Policy, 1983, 113; EEC Commission, Fourteenth Report on Competition Policy, 1985, 124 and 132.

68. Directive 81/363/EEC of April 28, 1981.

69. ANORMED, 1988.006/37, note on the CSCN meeting of July 22 1982.

70. FNA, minister of Foreign Affairs, DECE 2,303, letter Andriessen, February 13 1984.

71. Todd, Industrial Dislocation. 79; Strath, The Politics, 134.

72. BNA, PREM 19/1,325, letter Lawson to the Prime Minister, January 9, 1984; note AT, January 11, 1984; PREM 19/1,326, note Turnbull, February 7, 1984.

73. FNA, minister of Foreign Affairs, DECE 2,303, letter Andriessen, 6 December 1984; EEC archives, BDT 323/93/210: note Boos, December 18, 1984.

74. EUA, BDT 323/93/210, note DG III/C, January 11, 1984.

75. EUA, BDT 327/94/217, note DG IV-D Sunnen, November 5, 1981.

76. EUA, BDT 323/93/210, note DG IV-D-3, March 9, 1984.

77. EUA, BDT 323/93/210, note Braun to Caspari, March 27, 1984.

78. EUA, BDT 327/94/217, letter Davignon to Andriessen, January 16, 1984.

79. EUA, BDT 327/94/217, note Caspari to Andriessen, February 3, 1984.

80. ANORMED, 1988.006/714, note on the meeting of the board of May 7, 1985.

81. ANORMED, 1988.006/714, note on the meeting of October 3, 1984; note on the meeting of boards directors on June 28, 1984.

82. FNA, 1991.0289/39, note CIRI of May 28, 1984; on CIRI, see Cohen, L’Etat brancardier, 167–170.

83. FNA, 1991.0289/39, note DIMME, December 24, 1985.

84. AMINEFI, B 71,982, note Don Pierre Giacobbi and Robert Nicolas, March 25 1986.

85. For the conversion: http://www.insee.fr/ [Accessed 31 August 2014].

86. ‘Tempête sur la navale, les syndicats sur le pont.’ Libération, June 24, 1986.

87. FNA, 1991.0289/39, letter from Cresson to Bérégovoy, December 4, 1984.

88. FNA, ministry of Finance, B 71,982, letter from Bérégovoy to Fabius, 7 May 1985.

89. ‘Les chantiers navals sont un gouffre déclare M. Bérégovoy.’ Le Monde, June 12, 1985.

90. ‘Plusieurs centaines d’emplois menacés au chantier naval de Dunkerque.’ La Voix du Nord, June 22, 1985.

91. AMINEFI, B 71,982, notes on the inter-ministerial meetings of June 4 and 19, 1985.

92. FNA, 5 AG 4/ 3,113, report to the Parliament on the aid to Industry, 1987.

93. Orientation paper on future aid strategy for shipbuilding. Communication from the Commission to the Council, doc. Com (86) 324, July 31, 1986, annex I, 12.

94. ‘La SNCF confirme une commande d’un train-ferry aux Chantiers Normed.’ Les Echos, December 16, 1985.

95. « L’intersyndicale du chantier Normed rappelle les Pouvoirs publics et la Direction aux engagements pris l’année dernière », La Voix du Nord, 8 February 1985; « Une lettre des syndicats de Normed à Mme Edith Cresson », La Voix du Nord, 29 April 1985.

96. British National Archives, PREM 19/1,025, note of November 30, 1983.

97. ”Normed: les salariés sur le qui-vive,” Le Figaro, June 19, 1986; “Un plan social hors jauge pour Normed,” Les Echos, June 27 1986.

98. Levy, “Redeploying the State,” 103–126.

99. AMINEFI, B 69,856, note of the director of the Budget, no date but after March 1986.

100. AMINEFI, B 71,982, note of the Treasury, no date but after March 1986.

101. AMINEFI, B 71,982, note of the Treasury, no date but after March 1986 ; B 69,858, note Gadonneix, April 18, 1986.

102. « Normed: plus de mille à Paris », Liberté, 9 juin 1986.

103. “Normed: les salariés sur le qui-vive,” Le Figaro, June 19, 1986; “Un plan social hors jauge pour Normed,” Les Echos, June 27 1986.

104. AMINEFI, B 69,858, note from the Treasury, October 17, 1986.

105. On the evolution of EEC’s state-aid policy in the 1980s: Warlouzet, Governing Europe.

106. FNA, ministry of Foreign Affairs, DECE 2,303, letters from the Commission to Dumas, August 13 and 19, 1985.

107. Interview of the author with Peter Sutherland (September 8, 2011) and with Jean-François Verstrynghe (February 10, 2012), a member of his cabinet, available on the website of the EU archives: http://archives.eui.eu/en/oral_history; On Sutherland’s impact on EEC competition policy: Warlouzet, Governing Europe.

108. On the end of the negotiation over the merger regulation, see Warlouzet, “The Centralization.”

109. European Commission, First survey on state aids in the European Community, SEC (88) 1981, December 13, 1988.

110. EUA, BAC 327/1994/159, note from the Director General to Sunnen, October 11, 1985; letter Andriessen, November 28, 1984.

111. Decision of the Commission 87/585/CEE of 15 July 1987.

112. GNA, B 102/375,364, note BMWi, Mehrländer, 4 March 1985; B 102/306,934, note BMWi, Mehrländer, 25 June 1986; letter from Schlecht to Sutherland, 24 June 1986.

113. Seevaratnam, Governing the Shipyards, 145–149.

114. Orientation paper on future aid strategy for shipbuilding. Communication from the Commission to the Council, doc Com (86) 324, July 31, 1986, 13.

115. FNA, 1990.0452/26, note SGG of May 20, 1986 on the inter-ministerial meeting of the same day; FNA, 5AG4 / 3,113, note Boublil, June 11, 1986.

116. FNA, 1990.0452/26, note on a meeting between Balladur (French Finance Minister), Madelin and Sutherland on the May 26, 1986.

117. FNA, ministry of Foreign affairs, DECE 2,303, lettre from Sutherland to the French Foreign Affairs Minister Raimond, June 18 1986.

118. AD 83, 48 J 40, meeting of the board of September 24, 1986.

119. FNA, ministry of Foreign affairs, DECE 2,225, note DAEF, July 23, 1986.

120. AMINEFI, B 69,858, note from the director of the Budget division, June 23, 1986; note from the director of the Treasury, October 17, 1986.

121. AD 83, 48 J 40, meeting of the board of September 24, 1986.

122. “Construction navale. La Commission européenne prône une modulation des aides,” Les Echos, July 17, 1986; “Aides à la construction: propositions européennes,” Le Figaro, October 2, 1986; “La France attend le feu vert de la CEE,” Nord-Matin, July 5, 1985; “Construction navale. Toujours en surcapacité, pas d’éclaircie en vue.” La Voix du Nord, November 11, 1986.

123. FNA, ministry of Finance, B 69.856, note SCGI on a meeting of October 9, 1986.