Toyota to Cut 100 Jobs December

[csv8]

THE struggling car manufacturing industry has received another blow with Toyota announcing it will cut a further 100 jobs in Melbourne because of a fall in export demand for the Camry.

Australia's biggest producer and exporter of cars says the latest round of redundancies will happen by December, when it will cut the number of vehicles it builds per day from 470 to 430.

"I speak with a heavy heart … we've had to make a very difficult decision today and announce up to 100 voluntary redundancies," said Dave Buttner, Toyota Australia executive vice president and chief operating officer.

"This decision is always made very very carefully but has been brought about due to a drop in export orders … it means we can no longer sustain the current workforce."

The latest job losses come after Toyota sacked 350 workers in a forced redundancy program in April 2012.

Victorian Opposition Leader Daniel Andrews said the job losses were sad news for the workers.

"Now is not the time to walk away from the automotive industry, if we want a diverse economy, if we want to be a community and an economy that makes things the automotive industry, the engineering and design capability that comes from auto is critically important to our state," Mr Andrews said.

"I think it's incumbent upon Denis Napthine to pick up the phone to Tony Abbott and find out exactly what Tony Abbott's plans are."

"We cannot afford to lose automotive jobs, if you're not making cars I don't think you'll be making very much."

Despite the second round of cuts in two years Toyota will still have the largest blue collar workforce among Australia's three car makers, with the number of employees standing at 2400 after the redundancies (compared to 1700 at Holden and 1500 at Ford).

Mr Buttner said Toyota was committed to building cars in Australia beyond 2018 but a decision on future models would be made next year.

Toyota Australia needs to find ways to save $3800 per car to become competitive with the seven other factories around the world that also make the Camry, including Thailand and North America, both of which have Free Trade Agreements with Australia.

"This reduction … is a further solid reminder of the global nature of Toyota's business in Australia now," said Mr Buttner.

When asked if he thought Holden would survive, Mr Buttner said he hoped "Holden remain in this country and support the local supplier base".

When asked if Toyota's Australian operations could survive without Holden, Mr Buttner said: "We are laying the foundations for our future growth. We have a very strong desire to continue to build cars in this country."

Holden is negotiating with the new Federal Government for an increase in taxpayer funding by the middle of next year or face being shut down.

Toyota has been building cars in Australia for 50 years (since 1963) and building engines locally since 1979.

Last month it produced its 3 millionth car and the engine factory assembled its 2 millionth engine.

Toyota has been exporting about 70,000 cars per year (about 70 per cent of its production) to the Middle East since 1996 but export orders fell by about 5000 deliveries this year.

Mr Buttner said it was too early to speculate on the addition of a third model to the Toyota Australia factory, but he said the facility had the capacity to expand if conditions were favourable.

Toyota executives are meeting with Federal Industry Minister Ian Macfarlane on Friday as part of ongoing negotiations but Mr Buttner said Toyota was not asking for an increase in funding, as Holden was.

"We will continue to work with the government to understand our vision and what we're doing to strengthen our business," said Mr Buttner.

"We are not pursuing any incremental funds (but) we were relatively comfortable with the levels of assistance being mooted by the previous government.

"We continue to engage with Minister Macfarlane and his department so they understand the challenges we face as an industry."

This reporter is on Twitter: @JoshuaDowling
http://www.couriermail.com.au/news/t...-1226740173978

[zilo]

oh...damn, I thought Toyota jobs were safe.

[Wretched]

Voluntary only at the moment.

"...It says there will be no compulsory redundancies."

http://www.abc.net.au/news/2013-10-1...bourne/5023310

[mik]

Trying to save $ 3800 per car, that sounds like a huge task, put the price up and lose some sales?

[Syndrome]

Makes Toyota Australia's position more difficult when it comes to negotiating with the head office to get the next all new Camry/Aurion built in Australia.

[Brazen]

Originally Posted by mik

Trying to save $ 3800 per car, that sounds like a huge task, put the price up and lose some sales?

I know they benchmark agains the Camry plant in Kentucky, as it might be currency adjusted a fall in the dollar could mean thousands difference per car.

[rdmr]

Surely toyota have not been making cars here since 1963 as stated in the article?

Hmm, just checked wikipedia. They were.

[Motorbreath310]

This deeply concerns me. Not just for Toyota, but for Australian manufacturing as a whole. What are all these people going to do? where are they gonna go?

It seems like there's a massive plant closure every other week.

I know not of a solution, or even a probable outcome. I actually lose sleep at times thinking about this. Please tell me there's something I'm missing?

[malazn mafia]

Maybe drop the geriatric Camry and retool the plant for Rav4 and FT86? Surely this would help the numbers make sense?

[flooded one]

Originally Posted by malazn mafia

Maybe drop the geriatric Camry and retool the plant for Rav4 and FT86? Surely this would help the numbers make sense?

no they need Camry. Camry outsells both these cars world wide. not just in Australia.

[pajoda]

It appears its closing time all round, Ford prominant, Holden shaky, and now Toyota showing cracks, we can't maintain this for so many reasons, there are a lot of countries around the world that do not have a car manufacturing industry, at 20 million we are a size that should not consider it a right, we do not have the size or cheap labour that creates a future. It is a shame, agree with that, small markets need to specialise, wide scale manufacturing is not our future.

[pajoda]

Originally Posted by malazn mafia

Maybe drop the geriatric Camry and retool the plant for Rav4 and FT86? Surely this would help the numbers make sense?

I have no concept of why this car sells like it does, but it does, lots appear to crash, maybe its parts sales that keep this vehicle as an attractive an ongoing concern.

[GCRXR6]

This only demonstrates further that car manufacturing in Australia is dead. Just like TV, electronics, toys, tools, clothing.....etc, etc. Manufacturers locate huge factories in countries with low wages and pump out the goods for sale around the world. How much do you think your iPhone cost to make?

Yes this is a Forum of motoring enthusiasts with an interest in ford products, but, we need to face reality. We, that is not only we members, but also the Australian population, have played the major part in this. We demand that our goods be cheaper, yet, we demand higher wages without supporting our local manufacturers.

[flooded one]

Originally Posted by pajoda

I have no concept of why this car sells like it does, but it does, lots appear to crash, maybe its parts sales that keep this vehicle as an attractive an ongoing concern.

because of its reputation is why it sells. Camry's do the job well for what they are. they don't have the bogan reputation the modern Commodores have and don't have the garbage Dinosaur claim that's labelled at our current Falcon. the only issue I have with Camry is its boring and very bland.

I might add not all car buys are enthusiasts

[BHDOGS]

Originally Posted by GCRXR6

This only demonstrates further that car manufacturing in Australia is dead. Just like TV, electronics, toys, tools, clothing.....etc, etc. Manufacturers locate huge factories in countries with low wages and pump out the goods for sale around the world. How much do you think your iPhone cost to make?

Yes this is a Forum of motoring enthusiasts with an interest in ford products, but, we need to face reality. We, that is not only we members, but also the Australian population, have played the major part in this. We demand that our goods be cheaper, yet, we demand higher wages without supporting our local manufacturers.

An iphone cost 200 to make it is then sold to telstra for about 500-600 i believe

[XR Martin]

Toyota admitted a little while ago that they've been losing money on building cars here for years. Its fortunate that they make so much on other vehicles which gives them an overall profit. Fairly sure every Camry they sell is at a loss, they only make money on the Aurions (which they sell little of)
But obviously that cant continue forever.

[buickman]

Most Camry's sold are fleet cars so that would cut their profits as well.

[ILLaViTaR]

We need to give them a 200 million handout.

[BroadyFord]

Profit of doom Joshua Dowling spells it out:

Toyota job cuts push Australian car manufacturing industry to brink


http://mobile.news.com.au/business/c...-1226740173978

THE Australian car manufacturing industry is officially on the brink after Toyota put the Federal Government on notice yesterday by revealing it must achieve the same drastic cost reductions as Holden or face shutdown.

Toyota executives publicly talked up the company’s future in Australia, reflected on its 50-year history as a local manufacturer and did not explicitly threaten a factory closure.

However, after the announcement a senior Toyota insider told News Corp Australia that Toyota is losing more money than Holden on its locally-made cars and that manufacturing in Australia is “not sustainable”.

"If Holden goes Toyota will almost certainly follow," said the senior Toyota executive, speaking on condition of anonymity. "It won't happen the same week, it will be a slow wind-down."

"Toyota can’t increase production capacity at another plant overnight to supply 70,000 vehicles to the Middle East, but it can be done over a relatively short period of time, within a year."
The Toyota insider said "regardless of what is said publicly the situation is grim". He said it was "not the Japanese way to hold governments to ransom through the media."

Toyota recently was pledged $30 million in taxpayer funds to go towards the updated Camry to be built in Altona from 2015 to 2018, but a decision on the model beyond that would be made some time next year.

The insider said there are two factions at senior levels within Toyota, a growing number of executives who want to shut the factory to stem the massive financial losses, and others who are trying to save it against the odds.

"A lot of very important people want to keep it, even though the numbers don’t add up," said the insider. "But every day more and more people start to see the financial ruin that local manufacturing is causing."

Last year News Corp reported that Toyota Australia loses about $2500 on every car it exports because of the strength of the Australian dollar.

But the insider has revealed that Toyota loses up to $3000 on each car it sells locally, and up to $5000 per car when it does special low-interest finance or drive-away deals.

"We are jamming locally-made cars into dealers and bundling them with imported models that are in demand," said the insider. "No-one’s making any money on this. It’s not sustainable."

Toyota Australia spokeswoman Beck Angel said the figures supplied on the loss per locally-made car are "inaccurate" and that "it is our vision to continue building cars in Australia".

Toyota, Australia's biggest producer and exporter of cars, had been held up by the newly elected Federal Coalition Industry Minister Ian Macfarlane as a prime example of how to do business.

But it has since transpired that Toyota Australia’s loss-making manufacturing operations are being propped up by its highly profitable import business.

During yesterday’s surprise announcement of 100 redundancies in Melbourne (Toyota’s second round of factory job cuts in two years) the Japanese company revealed it must cut a massive $3800 from the cost of each car it builds - or risk losing production to one of seven overseas factories that also make the Camry.

Toyota’s figure was eerily close to the $3750 cost reduction target revealed by Holden in the lead-up to its wage negotiations earlier this year.

When asked if Toyota would be making cars in Australia beyond 2018 - the end of the current production cycle - Toyota Australia’s executive vice president and chief operating officer Dave Buttner told media: "We will continue to work with the government to understand our vision and what we’re doing to strengthen our business."

Mr Buttner insisted Toyota was not asking for an increase in taxpayer assistance but he indicated that cuts proposed by the new Federal Government would hurt the industry.

"We are not pursuing any incremental funds (but) we were relatively comfortable with the levels of assistance mooted by the previous government," said Mr Buttner.

"We continue to engage with Minister Macfarlane and his department so they understand the challenges we face as an industry."

Shadow Industry Minister, Kim Carr, said Toyota’s announcement "should serve as a wake-up call to the Abbott Government".

"After more than a month in office it’s time the Abbott Government ended the delays and gave Australia’s automotive manufacturers, and the tens of thousands of workers they employ, certainty," said Mr Carr.

"The Abbott Government needs to provide the industry with a long term commitment that it can take to the bank."

A statement from Industry Minister Ian Macfarlane said: "The Coalition Government is committed to working with the car industry on the challenges it faces and about a long-term future for the industry in Australia.

"The Government’s plans for a Productivity Commission review are proceeding and I will continue to consult with the industry on all matters relating to the car industry in Australia."

Toyota says the latest round of redundancies will happen by December, when it will cut the number of vehicles it builds per day from 470 to 430.

The latest job losses come after Toyota sacked 350 workers in a forced redundancy program in April 2012.

Despite the second round of cuts in two years Toyota will still have the largest blue collar workforce among Australia’s three car makers, with the number of employees standing at 2400 after the redundancies (compared to 1700 at Holden and 1500 at Ford).

When asked if he thought Holden would survive, Mr Buttner said he hoped "Holden remain in this country and support the local supplier base".

When asked if Toyota’s Australian operations could survive without Holden, Mr Buttner said: "We are laying the foundations for our future growth. We have a very strong desire to continue to build cars in this country."

Holden is negotiating with the new Federal Government for an increase in taxpayer funding by the middle of next year or face being shut down.

Toyota has been building cars in Australia for since 1963 and building engines locally since 1979.

Last month Toyota produced its 3 millionth car and the engine factory assembled its 2 millionth engine.

Toyota has been exporting about 70,000 cars per year (about 70 per cent of its production) to the Middle East since 1996 but export orders fell by about 5000 deliveries this year.

Mr Buttner said it was too early to speculate on the addition of a third model to the Toyota Australia factory, but he said the facility had the capacity to expand if conditions were favourable.

[TMC]

Originally Posted by BHDOGS

An iphone cost 200 to make it is then sold to telstra for about 500-600 i believe

Having worked in the electronics industry, I would hazard a guess that the cost of the raw parts in an iPhone cost about $20 assembled. An iPhone would go through a number of mark ups at different levels of manufacture and onselling until we pay many thousand of a percent more for it.

Now back to Toyota......

[XR Martin]

Funny how people think just because something costs X amount to make, then it should be sold for X+1, otherwise we're getting ripped off.
That may be fine for a pencil, but anything with R&D (past and future) needs those costs covered aswell as the manufacturing costs.

[jpd80]

Toyota has just announced that it needs to reduce cots on every camy it builds by $3,800 a car, that happens
to be around 104,000 cars total this year or just over $380 million, a figure no amount of wage cuts will fix.

Me thinks this is the comparative cost from another plant in Asia, Toyota would be crazy to not pull out and use
an alternative supply location, $380 million is a lot of money to throw away or worse expect someone else to pay for..

Toyota's export plan is underwater and no amount of cost cutting will save it.

[ILLaViTaR]

Originally Posted by XR6 Martin

Funny how people think just because something costs X amount to make, then it should be sold for X+1, otherwise we're getting ripped off.
That may be fine for a pencil, but anything with R&D (past and future) needs those costs covered aswell as the manufacturing costs.

But they think that because those costs should be included under X already, then the profit should be +1 of this value. You've broken X into multiple variables which isn't right at all, all these excuses/additional costs you use to justify a higher profit margin should already be categorized under X, and only then can the +1 be determined.

A lot of businesses would want to break X into multiple variables, it's in their best interests to create an alternate structure which benefits their profit margin.

[mik]

The writing is on the wall, we have been steered down a path by our decision makers to be importers, it is obvious, this has been mentioned time and time again over the years, and i'm convinced the greater reliance on other countries for product is and will continue to bite us on the on the Khyber pass.
Unless things change you would have to bet the car makers of today in oz will be just like every other car maker that has tried to make cars here, they will be extinct .

[Mr G8]

A good mate of mine has gotten income insurance due to this as he's unsure what will happen.

[zilo]

Originally Posted by TMC

Having worked in the electronics industry, I would hazard a guess that the cost of the raw parts in an iPhone cost about $20 assembled. ......

My guess is that your guess is way too low, margins have never been that good in the electronics industry.

I would say more like 200 dollars assembled even with slave labour.

[Dr Smith]

Originally Posted by jpd80

Toyota has just announced that it needs to reduce cots on every camy it builds by $3,800 a car, that happens
to be around 104,000 cars total this year or just over $380 million, a figure no amount of wage cuts will fix.

Me thinks this is the comparative cost from another plant in Asia, Toyota would be crazy to not pull out and use
an alternative supply location, $380 million is a lot of money to throw away or worse expect someone else to pay for..

Toyota's export plan is underwater and no amount of cost cutting will save it.

And the sting from the ATO penalties for its pricing structure for all those exported cars has come home to roost...make a loss (or charge unrealistically low prices for your goods) here in a high tax country to maximise profit in zero/low tax country cannot keep happening when you're asking for Aust. taxpayer dollars as well.

[1TUFFUTE]

I cant stand how much baffling goes on about saving the industry...the second the government decided to let ford back out......it was over. Its just a matter of time because money rules the roost. They may hang on for a bit..but eventually they will be Forced to move on. They cant turn around and fully support holden and Toyota after just letting ford go!
If they had a brain they would have sunk as much money into ford/holden and Toyota to keep them here. They are companies that bring in a lot of money/work/tax and so on for a lot of people. Theres a huge monetary benefit overall having an auto industry....but obviously the people who make the calls in govco have missed this point in all there squabbling for the next year of work they all fight for.

[XBGTFGGTP]

Originally Posted by 1TUFFUTE

I cant stand how much baffling goes on about saving the industry...the second the government decided to let ford back out......it was over. Its just a matter of time because money rules the roost. They may hang on for a bit..but eventually they will be Forced to move on. They cant turn around and fully support holden and Toyota after just letting ford go!
If they had a brain they would have sunk as much money into ford/holden and Toyota to keep them here. They are companies that bring in a lot of money/work/tax and so on for a lot of people. Theres a huge monetary benefit overall having an auto industry....but obviously the people who make the calls in govco have missed this point in all there squabbling for the next year of work they all fight for.

Demand is changing and not everyone wants to drive a falcon or crumble door. Customers want cars that offer more versatility, have more options, are better on fuel and are affordable. The simple fact is you can't produce vehicles in Australia competitively against the rest of the world and it's only going to get worse. The longer this is left to drag on the deeper the hole for all those playing in it.

Why do you think Ford is committed to getting out by 2016 as they have done the sums and they know it's not going to work. They have a great range of vehicles that will be available at cheaper prices and return a profit that helps sustain the company.

Ford have committed to the local industry by keeping the R&D department going using the talents of the local people for design and engineering and that is a huge compliment. The manufacturing can be done anywhere but the design work is the specialist key to bringing more work.

Cars are consumerables just like TV's, steros etc and how many are made in Australia?