Case Study Of Toyota To Stop Making Cars In Australia

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Toyota to stop making cars in Australia, follows Ford and Holden
FEBRUARY 10, 2014
TOYOTA has announced it will cease making cars in Australia in 2017, blaming the cost of manufacturing and the high dollar.
Toyota announced the closure of its Altona plant this afternoon and was briefing workers on the withdrawal. The company has been making cars in Australia since 1963.
Toyota’s move follows the decisions of Ford and Holden to quit manufacturing in Australia by 2016 and 2017 respectively. It means that from 2017, Australia will not have a local car manufacturing industry. Toyota’s closure is expected to cost 2500 employees their jobs.
“This decision will change the face of industry in Australia forever,” said Industry Minister Ian Macfarlane, who added that Toyota had made no request to Canberra for financial assistance. Tony Abbott said the government was focused on ensuring a strong economy and that the number of new jobs outweighed the number of closing jobs.
“Nothing that I say can limit the impact of this devastation and disappointment today (but) there will be better days in the future,’’ the Prime Minister told reporters in Canberra. Opposition Leader Bill Shorten said seeing Toyota follow Holden and Ford out the door was a disgrace.
“The car industry has died under the Abbott government,’’ he told Network Ten.
Together with the Holden and Ford closures, it will leave tens of thousands of jobs in the balance in the automotive component sector, which employs more than 30,000 workers. Toyota said it would become a national sales and distribution company. This means that local manufacturing of the Camry, Camry Hybrid and Aurion vehicles, as well as the production of four cylinder engines, will end by 2017.
Toyota said in a statement: “The decision was not based on any single factor. The market and economic factors contributing to the decision include the unfavourable Australian dollar that makes exports unviable, high costs of manufacturing and low economies of scale for our vehicle production and local supplier base. “Together with one of the most open and fragmented automotive markets in the world and increased competitiveness due to current and future free trade agreements, it is not viable to continue building cars in Australia.’’
Toyota Australia President and CEO, Max Yasuda, was joined by Toyota Motor Corporation President and CEO, Akio Toyoda, as he made the announcement to employees late this afternoon.
“This is devastating news for all of our employees who have dedicated their lives to the company during the past 50 years,’’ Mr Yasuda said.
“We did everything that we could to transform our business, but the reality is that there are too many factors beyond our control that make it unviable to build cars in Australia.’’
ACTU Secretary Dave Oliver said Tony Abbott had failed to stand up for Australian jobs.
“The Abbott government goaded Holden into leaving, they’ve done absolutely nothing to keep Toyota in this country and as a result Australia will lose up to 50,000 direct skilled jobs, $21 billion will be wiped from the economy and regions will go into recession.
“Mr Abbott promised one million new jobs within five years, that’s around six hundred new jobs every day but since he’s come to office, all we’ve seen are job losses.’’
National AMWU vehicle secretary Dave Smith said the decision would have devastating impact on everything from road transport to shipping and beyond.
“The magnitude of this decision in the community cannot be underestimated,’’ he said.
“We are looking at a potential recession all along the south-eastern seaboard.’’
The Altona plant closure would have a major impact on car component companies, said Victorian AMWU secretary Steve Dargavel.
“Car parts supplying domestic automotive will no longer be happening in Australia after 2017,’’ he told reporters outside Toyota’s Altona plant.
“It is possible that there are some