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Troubled automakers: Leyland skids, Chrysler hangs on; Labor dispute may send British car firm down dead-end road

After two years of more or less satisfactory labor relations, the British Leyland car manufacturing firm is entering 1981 in the grip of a crisis that government ministers and industrial experts believe could put it out of business before the spring.

BL's latest problem is so acute that management and labor leaders worked through Christmas in efforts to find a solution. The crisis centers on a strike by 1,500 workers at the company's Longbridge plant and has brought production of the BL Mini Metro, widely seen as a potential moneymaker, to a halt.

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The BL chairman, Sir Michael Edwardes, fears that if the stoppage is not settled within a week, it will place in jeopardy the company's entire operation and threaten the jobs of at least 50,000 workers. And if that happens, management is telling the unions, government financial backing for BL will evaporate, wiping out the company altogether.

Sir Michael has given the 1,500 strikers until Jan. 5 to return to work. If they do not, they will lose their jobs, raising the likelihood that a substantial portion of the entirel BL work force will join the strike.

For BL's leader, the crisis is a source of bitter frustration. Like many of strife-torn company's past troubles, this crisis stems from a comparatively small incident.

Last November, eight workers -- four of them shop stewards -- were accused by management of leading a near riot of by 300 Longbridge employees who objected to a management decision to install imported seats in a number of cars.

The workers occupied the administration block, damaged buildings and vehicles , and threw switches that brought production at Longbridge to a halt. The eight alleged ring-leaders were sacked, whereupon 1,500 other workers came out in unofficial support.

Ever since then, management and unions, with the help of the government's Advisory, Conciliation, and Arbitration Service, have been trying to find a solution to the dispute. They have failed.

Sir Michael and his executives insist the eight "ringleaders" cannot be rehired. The unions say management handled the whole question badly and that the eight are beeing unfairly picked on.

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The dispute typifies some of BL's worst problems in industrial relations. The difference this time is that it has come at a genuinely critical moment -- as the Mini Metr was beginning to "take off" and Sir Michael was asking the government for an additional $:1 billion ($2.4 billion) of capital backing for 1981.

BL is roughly halfway through the Edwardes five-year recovery plan. If a way is not found to end the current dispute, the progress Sir Michael has made stands to be nullified.

BL says that if the Jan. 5 deadline passes and the 1,500 strikers lose their jobs, new workers will be hired to take their places.

But it is widely felt that such an action on management's part would be a certain formula for widening the stoppage and putting an end to any hopes the Mini Metro will make a market penetration deep enough to begin solving the company's long-term financial problems.

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