With Ford and General Motors both announcing an end to production in Australia, the country's auto industry is in a bad way. With the exit of two big players, there's increased concern that a third Australian manufacturer, Toyota, will be forced out, as well.

"We are saddened to learn of GM Holden's decision. This will place unprecedented pressure on the local supplier network and our ability to build cars in Australia," Toyota Australia said in a statement. The GM closure of Holden production will be the direct end to 2,900 jobs, but will also force a dramatic reduction in the size of the country's supplier network, as there will simply be fewer cars to build.

In the same statement, Toyota Australia said it would work with suppliers and local government to figure out whether continuing production Down Under was even feasible. According to Automotive News, a representative for the Australian Manufacturing Workers' Union told reporters it was "highly likely" that Toyota would also close up shop within the next few years.


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  • 40 Comments
      Firefly
      • 1 Year Ago
      Unfortunately, this is not a winning proposition for Australians. They already have it bad enough with the import tariffs being high enough that a $31k Accord over there is closer to $42k. Now, no local manufacturing? This won't end well unless their tariff scheme is revised to compensate.
        Temple
        • 1 Year Ago
        @Firefly
        Right now, the tariff scheme is being revised in a massive way. If the TPP passes Australia will be tariff free cars from US, Thailand, Mexico, and Japan. In the short term, Australia also signed a free trade agreement with S. Korea, this means that GM is now planning on sending its S. Korean cars to the Australia.
          john96xlt
          • 1 Year Ago
          @Temple
          Holden has imported cars from South Korea before and still does, if I'm not mistaken (I could be).
      jordontannie
      • 1 Year Ago
      Its very Sad for me to see Toyota to winding up there business from Australia because My favorite Toyota car is 2013 Toyota FJ Cruiser.
      jz78817
      • 1 Year Ago
      But... but... but when GM and Chrysler were going bankrupt, esteemed minds like Dumbass... er, I mean Thomas Friedman assured us that if they went bust, Toyota would be ready and willing to pick up the slack and reap the rewards he thought they so richly deserved. So now you mean to tell me that Toyota's fate is intertwined with the US automakers'? Really? You mean, just like anyone with a bare shred of a clue was saying back in 2009?
        nsxrules
        • 1 Year Ago
        @jz78817
        Are you really trying to compare a country with sales of about 1 million cars per year to the US? Also in the US (and Canada and Mexico) we have far more manufacturers, from VW to Nissan, Hyundai, Honda, Mazda, Kim, VW, etc. Friedman was absolutely right.
          jz78817
          • 1 Year Ago
          @nsxrules
          "To say that other car manufacturers would just simply take over those lost sales with no consequences is pretty naive." especially when a large portion of the supplier base would be taken out too. "Other automakers" can't pick up the slack if they can't source parts. Friedman is an idiot, just like the other "automotive journalists" at the New York Times.
          Jerry
          • 1 Year Ago
          @nsxrules
          Compare how many vehicles GM and Chrysler sell in the US. Roughly 4.2 million out 14.5 million total sales. That's a significant amount. To say that other car manufacturers would just simply take over those lost sales with no consequences is pretty naive.
        John Oberle
        • 1 Year Ago
        @jz78817
        Toyota went to bat for the bailouts of GM and Chrysler in 2009. This is a small scale in Australia of what would have happened in the US. Ford would have been pulled in as well. They barely escaped the bailout of their own. had the down turn lasted longer Ford too would have had their hand out as well. It will be a long time before I vote Republican again. Letting a traditional bankruptcy work in this case would have been a disaster. Romney still couldn`t see it.
        rlog100
        • 1 Year Ago
        @jz78817
        Toyota came out and said they would probably shutdown US operation if GM & Chryler Went down.
        Val
        • 1 Year Ago
        @jz78817
        mm, how about somebody else, beside the goverenment, buying all the assets of GM and chrysler, and continuing production, just like what happened? Because unlike in australia, GM and chrysler still have significant market share, and their problems had to do with debt and pensions. Of course, it wouldn't be at the prices that were negotiated between the government and GM, but hey, those 1 million people wouldn't have voted for obama.
      Hazdaz
      • 1 Year Ago
      This situation right there is what would have happened to US car production if we let GM and Chrysler go under. All these right wing idiots that were willing to sacrifice those companies and proclaimed that "oh, other car makers would have taken their place" were wrong then and are being proven wrong now. The car industry is incredibly intertwined. If one major player drops out, it can take down an entire nation's production. Ford has left Australia, GM will as well and that doesn't give parts suppliers enough business if only Toyota and maybe a few other smaller brands are left. That then forces Toyota to also pull out. Domino effect. Thankfully cooler heads prevailed here in the US and now our auto production is at one of its highest levels in decades. Its a shame that Australia might soon see the end of its auto production, but that's what happens when one, and then another, key player in an industry pull out.
        1454
        • 1 Year Ago
        @Hazdaz
        Yeah, the only flaw to that logic is that America has more than two corps making cars in it's borders. Let's see, M-B, Hyundai, Nissan, BMW, Ford, Kia......And I'm sure there are more that I am forgetting. That also goes to show that the suppliers DO already make parts for all the OEM's. Which people like Julius and you fail to admit. Julius actually claimed it would take "years" to have those suppliers to start "receiving orders". So please stop with the false propaganda.
          1454
          • 1 Year Ago
          @1454
          It's actually funny that you try and use RP as a defense for your stupid assumption. Now that the plans are made, anyone with an RP machine can make them. QUICKLY. Why do you think the DoD freaked the fonk out when the plans hit the web? Then we wonder why people like you are guilible enough to believe that GM "going under" A) would have happened and B) would have taken the suppliers, dealers, and everyone with it. You make my head hurt.
          1454
          • 1 Year Ago
          @1454
          NEW Production. What part of NEW don't you understand? Is the part where you are developing from scratch that is getting you? No, the engineering blueprints, molds, etc have already been produced. So to move production to other companies is easy. Lastly, I have no earthly idea what the fonk you are talking about with alcoa. IIRC, alcoa makes like 90% of the aluminum. There is a difference between making RAW aluminum, and forming/cutting/molding parts from from a finished good. You are proving you aren't an engineer or you would know the difference. Geez.
          Julius
          • 1 Year Ago
          @1454
          Since I'm being quoted here, I thought I'd chime in: 1) Defense Distributed took 6 months to develop a single 3d printed gun, from design to working prototype. It had 12 parts, and worked 7 times before failing. Developing mass-manufactured OEM-grade parts (that would require a warranty) would take significantly longer than that. 2) to illustrate this, there's this quote: "Preparations are now underway at DAI to accommodate the new production. New equipment and an additional production line will be added, and employees will undergo a cumulative 4,000 man hours of training." This quote references a contract that was finalized January 1998, 9 months prior to the actual start of production of C5 SEATS by a Lear joint-venture... not the most complicated of things, and a design Lear already was building. http://m.prnewswire.com/news-releases/general-motors-and-lear-award-corvette-seat-production-to-detroit-automotive-interiors-76461677.html With that kind of turnaround time, you can see how a company living in a thin margin might not make it through to the start of actual paid-for deliveries without major cash infusions. And that was my point.
          Julius
          • 1 Year Ago
          @1454
          In addition, I'd also point out that things aren't always as simple as they could be - just a few more posts later, there's an article on how F-150 production is being delayed by 6-8 weeks just because there are issues with the aluminum alloy forming. Mind you, the supplier Alcoa is one of - if not THE - supplier of aluminum to other companies. Doing the same for Ford for the F-150 should have been child's play, right?
        Cruising
        • 1 Year Ago
        @Hazdaz
        Excellent points. Was listening to the radio last night and the host kept calling the bailouts ridiculous and we should have let them go under. The host should read this article.
      Jake
      • 1 Year Ago
      Why is the Australian govt. not jumping all over Ford, GM, and Toyota with tax incentives, or something?
        Robert Ryan
        • 1 Year Ago
        @Jake
        They have been to the tune of 19 Billion US so far.
        Robert Ryan
        • 1 Year Ago
        @Jake
        They have spent 19 Billion US in overall subsidies
        Chris O.
        • 1 Year Ago
        @Jake
        @Jake: The Australian government has put tax, lend/lease, and a number of other types of incentives out there (especially in the last 10 years), but it's just gotten to the point where it's no longer economically competitive to build cars within that market. It then follows that there is no benefit in continuing the subsidy, since it is not economically viable without the subsidy increasing, and being permanent. Keep in mind that the whole setup was tenuous enough that it was only going to take one manufacturer pulling out to make the rest fall like dominos. Considering the huge cost of platform development, the only real way for a mass automobile manufacturer to stay competitive, is to look to have global platforms (as much as is possible, anyway). Once you have modular global platforms, it doesn't make much sense to develop cars within a small market, without having much of a buying audience to distribute the costs across.
          john96xlt
          • 1 Year Ago
          @Chris O.
          @Jake, RHD doesn't have as much to do with this as you'd think. There are many RHD markets in the world, just not many of them in the market for large and expensive (wages) Australian built cars like the Falcon/Territory and the Zeta platform. I'm not sure what Toyota manufactures in the country. Smaller, much more popular RHD cars like the Fusion/Mondeo, Focus, Cruze, etc. can be built in Asian, South American or North American countries for a lot cheaper and imported to Australia in RHD form. To remain competitive with countries already selling similar products with lower manufacturing costs built elsewhere, production had to be moved or ended.
          Jake
          • 1 Year Ago
          @Chris O.
          OK, then no taxes AND you all start driving on the right side of the road.
      Pat
      • 1 Year Ago
      That's a cheap way to say that they're going to pull out too!
      • 1 Year Ago
      [blocked]
        Val
        • 1 Year Ago
        Gee, what about the fact that the US market is 20 times bigger than the australian, that 50% of cars made in america are by foreign manufacturers, that demand for cars in the US was still very strong, that the market share of GM and Chrysler was nowhere near as bad as it is in australia?
      Phlegming Liberal
      • 1 Year Ago
      Here's a country with a population less than that of Taiwan, and Taiwan only has one indigenous brand (Luxgen), with some Japanese "assembly" plants. No wonder they're pulling out.
        Robert Ryan
        • 1 Year Ago
        @Phlegming Liberal
        Oh here we go again. Sweden has less people than Taiwan but supports two Giant Global trucking companies Volvo(which incidentally owns Mack) and Scania, Volvo Cars are built in Sweden and are sold world wide.
        Basil Exposition
        • 1 Year Ago
        @Phlegming Liberal
        You can't compare two countries demand for autos based solely on their population.
      Duck
      • 1 Year Ago
      Awww, so the $17 minimum wage laws and communist practices of Australia are destroying jobs and driving out employers? Who would have thought!
      jordontannie
      • 1 Year Ago
      car service Melbourne
      Avinash Machado
      • 1 Year Ago
      I guess it is the end of Australian auto manufacturing.
      audisp0rta4
      • 1 Year Ago
      Man, that really sucks. Especially for the little guy working in the plant. :/
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