'Major announcement' from Toyota this afternoon

[BroadyFord]

Dowling...

Why Toyota had to go

http://www.carsguide.com.au/blogs-an...81910_20140210

AND then there were none. Toyota will join Ford and Holden and close its Australian factory in 2017.
The announcement was made after its car assembly operations lost an estimated $1.75 billion over the past 10 years -- despite an injection of about $1.2 billion in taxpayer dollars over that period.

Toyota’s reported financial results have never reflected the true cost of building cars locally because it made up for the losses with the massive profits from imported vehicles.
In the end, the strong Australian dollar, high labour rates and low import tariffs crippled the Camry factory in Altona on the western outskirts of Melbourne, and the jobs of the 2500 workers employed there.
The same economic conditions brought Ford and Holden to their knees. Indeed, the circumstances are so familiar the Toyota press release could easily have had Ford or Holden on the letterhead.
Toyota’s announcement will bring an end to vehicle manufacturing in Australia after more than 100 years -- and any hope of a revival.
Vehicles have been assembled in Australia since the early 1900s, and by Ford in an official capacity since 1925.
Nissan’s factory closure in 1992 was an early sign of the challenges ahead as neighbouring Asian countries with cheaper labour costs ramped up their car industries.
Mitsubishi’s factory shutdown in 2008 was much more ominous. Once Ford and Holden made their announcements last year -- albeit six months apart -- it was only a matter of time before Toyota would follow. It needed the other two car makers to help lower the cost of locally-sourced parts.
Toyota is not to blame for its dilemma. It built the first and only locally-made hybrid car, favoured economical four-cylinder vehicles over big six-cylinder sedans made by Holden and Ford.
Toyota was the only one of the three car makers to do exactly as the Federal Government had asked: to export the majority of its production to boost economies of scale.
The problem was Toyota lost at least $2500 on every one of the approximately 70,000 Camrys it exported to the Middle East annually.
Domestic car sales are no longer enough to sustain an assembly line because the Australian market is the most congested in the developed world, with more than 60 brands competing for 1.1 million sales. In the US, 38 brands compete for more than 15 million sales.
Toyota always wanted to be the last to turn out the lights. If it went first, as the biggest producer of vehicles, it would have been blamed for killing the entire industry.
Now it can shut its factory doors without looking like the bad guy. Toyota insiders say the company’s local manufacturing operations had been holding the company back for at least 10 years.
The Japanese boss of Toyota Australia, the media shy Max Yasuda, who once blamed the Australian worker culture of the “sickie” as one of the challenges to building cars here, said the shutdown was “devastating news”.
Behind closed doors, however, Mr Yasuda bluntly told his peers soon after his arrival “if Holden goes, we’ll go”.
The Altona factory is believed to be only the third in the world that Toyota has closed; a New Zealand assembly line shut in 1998 and a US joint-venture facility with General Motors was sold in 2010.
Toyota held Australia close to its corporate heart as it was the first destination for exports, and the first country outside Japan it assembled vehicles, starting with the Corolla in 1968.
There is no question Toyota Australia executives fought hard to save the factory. They overcame the first two cost-saving hurdles on the way to slash $3800 from the assembly of each car. But the next three were out of reach.
In the end it will be cheaper and more profitable for Toyota to import the Camry from one of the seven other countries where it is made, including Japan, Thailand, Taiwan and Vietnam.
The strong stance from a Federal Government refusing to prop up ailing industries could be seen clearly from Japan.
If the Federal Government couldn’t find $25 million to help Australia’s last fruit packing company, SPC, then Toyota would hardly be likely to have a more favorable hearing if asking for 10 times more than that.
It is sad that the Australian car manufacturing industry will come to an end, but it was inevitable.
Decades of government policies from both sides of politics have shaped the economic conditions that Australia now finds itself with.
Being surrounded by developing countries with low wages and governments keen to attract car factories -- with no need for exports from Australia -- left the Australian car industry with no way out.

[nstg8a]

For once I agree with him

[buggerlugs]

What about all the small companies that supply the big 3..............Oh dear.................

[jpd80]

In one selfish generation, we've gone from the "can do" country to "don't even try, let someone else do it".

[2011G6E]

Too expensive to make cars here? Remember the news item a short while ago that revealed it cost only about $3500 less to make a car in Asia than it does here...? Surprised the hell out of me.

[joolz]

Originally Posted by buggerlugs

What about all the small companies that supply the big 3..............Oh dear.................

10's of thousands more will be out of a job. I was working in the supply chain for 9 years and the cheaper imports were a killer to local industry. If only a suitable tarriff was imposed like Thialand has. Funny enough they are booming and protected from imports..

[turbodewd]

The main causes of this are:

* the GFC
* high Aussie dollar
* relatively high Aussie wages
* very open auto market which is highly fragmented
* move to global cars, eg Focus or Camry found across the globe
* inconsistent AU-buying policy by state/territory governments (seeing the ACT govt buying Kias made my blood boil while Victorian government bodies did indeed buy local)

[Road_Warrior]

Originally Posted by joolz

10's of thousands more will be out of a job. I was working in the supply chain for 9 years and the cheaper imports were a killer to local industry. If only a suitable tarriff was imposed like Thialand has. Funny enough they are booming and protected from imports..

But but we have Free Trade Agreement with Thailandland!

[Bossxr8]

This is a bloody disaster. Victoria is about to go through a massive unemployment problem over the next few years.

Maybe it's better for Ford workers to be the first out the door before the 10's of thousands that follow.

[JG34JA]

Originally Posted by Loud_Noises

All awesome ideas except... I don't see capital, I see mountains of debt. We can't keep kicking the can down the road funding everything with yet more debt. There will come a time when the interest payable on said debt will grow so large, it will take every single cent of taxation to simply service it.

I was wondering if anyone would pick that up. You are correct - no capital. There's been a historic shortfall in this country since settlement. Only the lenders change. And the circumstance - like when loans were called in by London in 1932 and Jack Lang was removed. The Commonwealth Bank was established (1910 or 1911?) to provide a domestic capital base. It is now a private entity and borrows from New York to lend to housing speculation.

Everything else I mentioned is a furphy too - policy is hostile, AUD has been way too high, legislation has been onerous, and the culture shuns risk and entrepreneurialism. It will require a 180 about-face from what we have today. So the question is, stay and fight, or leave?

The whole situation is heartbreaking. In 1972 Australia and Canada were the wealthiest nations on earth per capita - with healthy manufacturing, agriculture and resources industries.

[Joe5619]

From about article ":They overcame the first two cost-saving hurdles on the way to slash $3800 from the assembly of each car. But the next three were out of reach."

What were the first 2 & what where the next 3?? Labor costs was one, but what are the others??

[Nikked]

[Maka]

Originally Posted by Barraxr8

We really need a bipartisan Vision for this country, and a vision for employment for those that aren't professionals.

Wouldn't it be nice if both sides of Parliament sat down and committed to a plan for the next 25 years ( and saw it through ) ?

I can see a train wreck for our children to deal with. When commodity prices crash and the dollar goes back to $US 70 what is our future ?

I would love to see your sentiments happen i really do, but with a royal commission on the way it will be some time before a visionary summit will happen, labor & the union movement are under seige atm it seems.

cheers, Maka

[cheap]

Mission accomplished! The CO2 tax worked wonderfully.

[Jason[98.EL]]

Originally Posted by Bossxr8

This is a bloody disaster. Victoria is about to go through a massive unemployment problem over the next few years.

Maybe it's better for Ford workers to be the first out the door before the 10's of thousands that follow.

that is a positive i guess

Boss I feel for you guys on the production floor I hope you guys find work asap

[Blue Roo]

Well, we're Screwed!
All Thanks to the Gillard (Carbon Tax) and Abbot Government (Screw the Manufacturing Industry).

[nstg8a]

Originally Posted by Nikked

image

'Manufacture'

[Franco Cozzo]

Originally Posted by Charliewool

What REALLY ****ses me off is Bill "commo" Shorten blaming the Libs, the dollar, and the car makers... FFS, wasn't he "el presidenta" of the bloody mob that caused this whole tragic fiasco?
AWU and AMWU... Hope your all bloody happy now and I pray all your delegates and reps ALSO lose their corrupt, shonky, blackmailing, bludging friggin jobs too!

I'm seeing a lot of union blame here, how about Ol' mate Johnny Eyebrows and his free trade agreements with Thailand? Or poor decisions by the fat cats leading the company down the wrong path?

Unless you want our manufacturing workers to work for less than a bowl of rice a month it just ain't happening.

[Nikked]

Originally Posted by nstg8a

'Manufacture'

Bugger it!

[2011G6E]

Yes, the carbon tax is probably more to blame than workers wages, especially in an industry that uses so much steel and aluminium which are energy intensive to produce and use.
It's not just the car makers, other steel industries are feeling it. In Rocky on the local news a spring works was saying they're winding back (ha!) production and importing stuff, as their power bills are going to more than double because of it.


As with Ford and Holden however, I wish the union guy wouldn't make statements like "Imagine having to go home and tell your family that you won't have a job at the end of 2017".
Please...most of us have had to "go home and tell our families" that we don't have a fricking job tomorrow, much less with three bloody years notice...stop complaining on that point or you'll lose a lot of support.

[PlukaDuck]

" OH WHAT A FEELING "

Any AUSTRALIAN who owns a foreign car has no right to complain.
Because there buying a foreigner a job.

And now there will be no Locally manufactured vechiles in Australia.
We have reached the tipping point.

And anyone who voted liberall has no right to complain because there policies has increased the foreign worker intake to 300,000 per year.

And just for the record the government is to introduce a tax on your bank deposit in 2016.
http://au.news.yahoo.com/a/18291381/...ank-customers/

Wake up Australians. Time to stand up and be accountable

[Nikked]

"One business is closing, another will open."
-Tony Abbott

[malazn mafia]

Originally Posted by Nikked

"One business is closing, another will open."
-Tony Abbott

One political party is not helping Australian industry, another will make it worse.

[monte.b]

Originally Posted by Road_Warrior

John Button and Paul Keating were right. Everyone who came after them squandered the opportunities that lay before us.

Did you live through those years of total disaster , I did ,they were right about NOTHING ,pair of total scumbags to use keating language ,they had pregnant fingers ,everything they they touched they ****** and this is the end result,congratulations ,they get the booby prize

[cheap]

Didn't take long to blame Abbott - He's been in power for 6 months, inherited an economic mess with +$300 Billion debt, yet people expect him to be able to change a trajectory that the previous mob of genius had taken 6 years to set.

I suppose steadfast refusing to rescind the CO2 tax is part of their spectacular visionary economic plan for Australia. Lets face it, the CO2 tax has worked a treat so far...

[Road_Warrior]

Originally Posted by monte.b

Did you live through those years of total disaster , I did ,they were right about NOTHING ,pair of total scumbags to use keating language ,they had pregnant fingers ,everything they they touched they ****** and this is the end result,congratulations ,they get the booby prize

Yes I did, perhaps I should clarify that they were right about what needs to be done to protect our industrial base. But you're right about the rest, how could I forget 16% interest rates on a mortgage!!

[buggerlugs]

And on the news tonight the first 13 minutes is dedicated to that slappa Corby, then another story, then a 2 minute segment on Toyota closing................Where is this country's priorities...........

[Nikked]

Originally Posted by cheap

Didn't take long to blame Abbott - He's been in power for 6 months, inherited an economic mess with +$300 Billion debt, yet people expect him to be able to change a trajectory that the previous mob of genius had taken 6 years to set.

I suppose steadfast refusing to rescind the CO2 tax is part of their spectacular visionary economic plan for Australia. Lets face it, the CO2 tax has worked a treat so far...

But, he didn't do a great deal to help them...just sat by...


Its not a fault of one government, but a successive string of changes to our polices that left the industry to suffer.

Its like a body bleeding out, and Abbott cut the life support.

[Nikked]

Originally Posted by buggerlugs

And on the news tonight the first 13 minutes is dedicated to that slappa Corby, then another story, then a 2 minute segment on Toyota closing................Where is this country's priorities...........

...don't forget the $ 3 million to secure exclusive rights to the Corby story.

[GT2]

Originally Posted by PlukaDuck

" OH WHAT A FEELING "

Any AUSTRALIAN who owns a foreign car has no right to complain.
Because there buying a foreigner a job.

And now there will be no Locally manufactured vechiles in Australia.
We have reached the tipping point.

And anyone who voted liberall has no right to complain because there policies has increased the foreign worker intake to 300,000 per year.

And just for the record the government is to introduce a tax on your bank deposit in 2016.
http://au.news.yahoo.com/a/18291381/...ank-customers/

Wake up Australians. Time to stand up and be accountable

The story was from 2013, the tax proposed by the previous Gillard government.