End of Ford Down Under

Ford to cease Australian automaking operations after 90 years

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Ford began manufacturing cars in Australia in 1925 with the Model T. In 2016, Ford will stop manufacturing cars Down Under, including the Falcon and the Territory SUV. Ford Australia CEO Bob Graziano has reportedly confirmed the closure of the company's Broadmeadows assembly plant and the Geelong engine plant, both in the state of Victoria. There will be 650 jobs lost at Broadmeadows, 510 sacrificed at Geelong. Of the roughly 3,000 workers the Blue Oval has in Australia, it's said it will try to retain about 1,000 of them at its R&D and product development facilities.

The writing hasn't just been on the wall, it's been a regular item in all the papers and on Ford's bottom line for years. As recently as 2003, Ford sold nearly 75,000 Falcons, but over the next four years, annual sales dropped by something like 10,000 units, and over the last two years, it has sold less than 20,000 per year. It isn't only Ford that has suffered – sales of the other large, locally produced sedan, the Holden Commodore, have also gone over the precipice, triggering the same kind of angst about Holden's continued existence. Ford is the smallest of Australia's local automakers, Holden and Toyota the others, and has posted losses of $AUD141 million last year ($136M US) and $AUD600 million ($580M US) in the past five years. Graziano said the cost of manufacturing is simply too expensive in the country, twice as high as Europe and three times as high as Asia, and there no way to make a business case for staying in the country.

In January 2012, Ford Australia announced it would stay in the country until at least 2016, but by July of the same year, most outside observers were quietly declaring that 2016 would be the last year of Ford Down Under, and even the speculation was making other observers nervous. Ford received money from the Victorian government last year to aid its refresh of the Falcon and Territory, which will continue on schedule for the 2014 model year. A front- and all-wheel-drive sedan on a global platform is predicted to replace the Falcon, with some other SUV expected to replace the Territory. The company says it still intends to expand its lineup in the country.

As for what will replace the employment hole at the factories and the supplier base, no one is quite sure. Ford has said that the employees will receive their entitlements, and workers do have three years to prepare for what's coming. As well, the state and national governments have already committed tens of millions to a fund to assist the employees.

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You'd think Australians would have learned a lesson in jobs buy buying domestic. It's not rocket science. If you don't buy what it is you and your neighbors do for a living, there are financial consequences. The consequences are usually slow to evolve, but never the less real. GM's situation isn't trending for the positive either, thus it looks like they are at risk for faltering in Australia as well.

Buy more imports, that will fix it.

Rut roh! Aussies are making too much money and now manufacturers are fleeing. GM hopes to fill the gap but they won't get it done by eliminating 500 jobs like they did a month ago.

Looks like Aussie auto sales were up about 3 to 4% annually.

joemac wrote:

Buy more imports, that will fix it.

Worked for us didn't it?

ggbaird wrote:

While I'm not much of a Ford fan I wish they'd hurry up and import this ute and show GM where another profitable niche market is, like the Raptor has.