At least 1200 jobs and Falcon nameplate to go, FPV and V8 racing now in limbo, as Ford pulls out from manufacturing in Australia
By GoAuto’s MIKE COSTELLO
FORD has announced it will shut the doors on its Australian motor vehicle manufacturing operations from October 2016.
Ford has been producing cars in Australia since 1925, when it opened its first plant in Geelong. Since 1960, it has produced the iconic Falcon in
The facelifted Falcon and Territory models due in 2014 – for which Ford received state and federal government payments of $43 million in early 2012 – will still launch as planned.
The company has no plans to further downsize its plants before they close, but will react if demand shrinks further.
The job losses – identified as 650 in Melbourne and 510 in Geelong – apply only to manufacturing, with Ford’s You Yangs testing facility, plus its sales and marketing divisions, to remain.
Ford Australia president and CEO Bob Graziano this morning informed workers of the decision – said to be taken by its US parent just hours earlier – which will result in 1200 job losses from its vehicle assembly plant at Broadmeadows in
the outer-Melbourne suburb of Campbellfield – also the home of the Falcon-based Territory SUV since 2004.
Mr Graziano told media today that Australia’s increasingly fragmented new-vehicle market – which has some 365 models from 65 brands competing for
of Melbourne, and at its engine plant in Geelong.
Many more jobs are expected to be lost in the supply chain and related industries.
The company also today posted a $141 million loss for 2012, which follows a $290 million loss in 2011 and brings total losses over the past five years to $600 million.
1.1 million sales – made it impossible to get the necessary scale required to make cars here profitably.
He also revealed that its decision to pull out of vehicle manufacturing will see the 53-year-oldFalconbadgeretired.
Ford’s 1000-strong Australian design and engineering centre – one of a handful of global “centres of excellence” – will also continue to contribute to global Ford projects.
In total, about 1500 staff will remain beyond 2016.
While Ford will look to redeploy staff where possible, Mr Graziano said that “realistically, we believe those opportunities will be limited”.
Full entitlements will be made to all those losing their job.
The decision, according to Mr Graziano, was ultimately reached this week as a final resort, and comes only after every other option – including additional government funding and vehicle exports – was considered and costed.
Mr Graziano said the cost of making a car here was double that of Ford’s costs in Europe and nearly four times as high as in Asia. Even after making some aggressive
“We also modelled some pretty aggressive assumptions – almost twice what you would normally see – about government support and labour costs, some of which we did not think would be palatable to any government or taxpayer, but we didn’t want to leave any stone unturned.
“Even with these assumptions, the business case simply didn't stack up, leading us to the conclusion that manufacturing is not viable for Ford in Australia in the long term.”
Mr Graziano defended Ford’s government funding in recent times – of which last year’s $43m payment was just one–stating that “for every dollar the government has given, Ford has returned six dollars to the economy” through jobs, contracts with suppliers and taxes.
Ford claims that, despite its withdrawal from local manufacturing, its commitment to Australia “remains strong”, with its model range to grow by 30 per cent by 2016.