[colliric]

Predicted this 15 years ago I did.

"Why is an American company not selling American cars to Australians? Why don't they sell the Mustang here? Wouldn't that make more sense and profit? Switch slowly over from Falcon to the Mustang."....

Me as we passed the Ford factory in Geelong, about 15 Christmases ago(we always drive to the surf coast).

Fuck the Car Manufacturers....

Let them go home(Holden is now nothing but an Aussie brandname, GM's home is Detroit!) and send us more American Muscle! Toyota will also go back to Japan one day.... Mark my words!

[Salohcin]

The question is: If we lose our heavy industry what will we retool to make weapons in the case of war?

One way or another, I think the way Abbott handles this will define his first term.

[colliric]

The question is: If we lose our heavy industry what will we retool to make weapons in the case of war?

One way or another, I think the way Abbott handles this will define his first term.

They're(the Fed Gov) going to seize the equipment, and plant is my dad's tip.

Clive Palmer's "all-in-one" proposal is most likely the best solution. Why the heck would Ford sell Australian cars when they're ultimately American? Why aren't they selling the Mustang here? This was ultimately inevitable. GM was a bit more of a shock to me, but obviously their books were alot worse than I thought and ultimately it makes sense for them to follow suit with their fellow Detroit buddies....

[Rei Murasame]

I assume you guys are referring to this story:

The closure of Holden and Toyota's production in Australia would leave the federal government with about $1 billion in unfunded leave and redundancy entitlements for parts industry workers.

Most of those payments would go to Victorian workers as experts warn the state would face the biggest single blow to its economy since the collapse of Ansett in 2001.

Insolvency experts say the taxpayer-funded federal entitlements guarantee would have to cover the payouts of parts industry workers made redundant.

The parts industry employs 18,000 people in Victoria and 6000 in South Australia, and most are expected to lose their jobs if Holden or Toyota follow Ford and pull the pin on local manufacturing.

Insolvency expert PPB Advisory estimates payouts would cost an average $64,000 for each parts industry worker.

''Many auto businesses will not be able to afford these payouts, so the cost will default to taxpayers, as the majority of the claims are now guaranteed in legislation,'' said PPB partner Stephen Longley.

Mr Longley has overseen liquidation of four Victorian parts suppliers, a total of 1000 jobs, in recent years. The average redundancy payout for each of the 1000 was $64,000, he said. ''Multiply that by 20,000 workers, and it's almost $1.3 billion.

''There's not enough left over to cover worker entitlements when these parts suppliers go under. The main driver is the long-term nature of these employees, coupled with redundancy provisions in the various EBAs, which often give four weeks' [pay] per year of service.''

Holden and Toyota will make announcements about their futures in Australia in the new year, and the Victorian government is preparing for hard times for the state's economy. A source at the Department of Environment and Primary Industries, which has been briefing the state government, said the end of car making in Australia would be ''the biggest single blow to the Victorian economy since the collapse of Ansett''.

''That [Ansett] was 17,000 direct jobs, and this will be in same ballpark for Victoria. We know where the jobs are. It's mainly the north and inner-west of Melbourne.''

A review of the parts industry, by Allens Consulting Group for the Federal Chamber of Automotive Industries found that local car makers spend $2.25 billion a year with suppliers in Victoria and $600 million in South Australia.

The Victorian parts industry directly employs 18,000 people.

Earlier this year BHP Billiton chairman Jac Nasser, who ran Ford in the US from 1998 to 2001, said the demise of just one local car manufacturer would, without extra government help, destroy the local parts industry.

''One of the three [companies] decide to exit Australia in terms of manufacturing, then you end up potentially with a subscale supplier infrastructure and, once that happens I think it's a domino effect,'' Mr Nasser said. ''It would be a very sad day for Australia but, unfortunately, it looks like it could be inevitable.''

Since Mr Nasser spoke those words, Ford has pulled out.

PPB Advisory chairman Ian Carson, a former president of the Liberal Party in Victoria, pointed out that the bill for redundancies equated to just two years of subsidies for the car industry. ''We need industries that don't require $500 million government funding a year just to survive,'' Mr Carson said. ''Victoria has a strong economy and there are lots of manufacturing success stories outside of the car industry.''

A key Productivity Commission report on the industry will be released in March.

It seems to me that the Liberal Party of Australia doesn't understand the complex web of links between parts manufacturers and major industries, as well as defence.

A lot of people don't understand this, but when plants are not responding to orders for the manufacturing of aircraft or tanks or whatever, they are often filling out volume by running like 'a bazillion off' of things like the rubber or thermoplastic sealing that goes around, say, the inside of the car door frame of the Toyota Corolla/Camry. If they didn't do that, they'd be closing their doors and shuttering their warehouses.

Liberals seem to have some kind of mental block that prevents them from understanding complex relationships between different companies.

Jac Nasser is correct, and Ian Carson is wrong.

[colliric]

Liberals seem to have some kind of mental block that prevents them from understanding complex relationships between different companies.

Actually they do.

I was informed recently, earlier this year(before this announcement was even made), by an insider with links to top Ford Australia employees(Management) that Ford Australia and Ford America hate each others guts because the Americans want to sell American cars here in Australia, while the Australian company is fighting its own American arm for survival. GM is clearly in the same situation and with the same problems. It's ultimately come down to Mustang VS Falcon VS whatever other V6 Sedan/Coupe is made by Ford in their other Countries as the Americans rudely remind everyone else THEY RUN THE DANG COMPANY and "Mustang is to be the 'worldwide' sedan model", a decision they should have made 15 years ago!

Ultimately in arguements like this... Detroit is going to win and we're just going to have to adapt and find employment opportunities elsewhere, possibly at Toyota or another company. It's harsh, but you can't lie to yourself that we'll survive in an arguement against far bigger players over in Ford's spiritual home city.

But of cause, even Toyota Australia has to follow it's own parent company back in Tokyo!

[Rei Murasame]

That's a good point too. But I'm puzzled about what they see in Detroit. After all, if Ford pulls back its manufacturing into Detroit, there is no-one there for them to employ anymore, and the city has fiscally collapsed due to their absence for decades.

With Toyota, if they pulled out of Australia and just exported cars from East Asia to Australia, that's probably a much easier move for Toyota to make, albeit still a move that would be bad for Australia.

[colliric]

That's a good point too. But I'm puzzled about what they see in Detroit. After all, if Ford pulls back its manufacturing into Detroit, there is no-one there for them to employ anymore, and the city has fiscally collapsed due to their absence for decades.

With Toyota, if they pulled out of Australia and just exported cars from East Asia to Australia, that's probably a much easier move for Toyota to make, albeit still a move that would be bad for Australia.

The American Government wrote certain control measures into it's Automotive assistance package, and one of these measures was that they build more cars in America.

Obama was criticized at the time for introducting policies that had the 'whiff' of protectionism. No doubt this factored into the decisions taken to expand their exports from America.

In otherwords... They're trying to get these companies to reverse the situation that Detroit, which is pretty reflective of the American Economy as a whole, is in.

Toyota doesn't have this issue yet. But if Japan continues it's economic slide as well, they probably soon will face pressure from the Japanese Government.

[foxdemon]

With Toyota, if they pulled out of Australia and just exported cars from East Asia to Australia, that's probably a much easier move for Toyota to make, albeit still a move that would be bad for Australia.

We sell resources to Japan, so if we import from Japan there is something going back into the local economy. Importing from the USA is a complete lose as far as trade balance goes.

If I had thing my way, the various levels of government would source their vehicle fleets from Toyota, providing they manuifacture in Australia. The money given to the industry then would provide someting back to the 'taxpayer'. However in this age of neo liberalism /economic rationalism, the government would never contemplate such an arrangement.

[AVT]

It was always going to happen, GM failed to anticipate the move away from large size sedans to the small car and 'soccer mum' try hard 4WD's. I don't think it is fair to blame this on the Libs, both Ford and Mutsubishi announced their closures during Labor's term, this is a structural problem with our economy which is effective off shoring our manufacturing because of mainly the high dollar. We are a victim of our own successes.

[Swagman]

Liberals seem to have some kind of mental block that prevents them from understanding complex relationships between different companies.

On the contrary propping up inefficient industry just leads to more inefficiency.

Socialists don't understand the complexities behind cause and effect and therefore ignore the fact that rewarding something creates more of it.

Reward inefficiency with taxpayer funding and you just create more inefficiency.....

Quasi public service......

Reward enterprise and innovation and you get more enterprise and innovation.

[foxdemon]

Socialists don't understand the complexities behind cause and effect and therefore ignore the fact that rewarding something creates more of it.

Reward inefficiency with taxpayer funding and you just create more inefficiency.....

Quasi public service......

Reward enterprise and innovation and you get more enterprise and innovation.

So you'd be opposed to bailing out the US finacial sector after the 2007 crash? Maybe they should have been allowed to fail. Damn yankee socialist capitalists, eh?

[Swagman]

So you'd be opposed to bailing out the US finacial sector after the 2007 crash? Maybe they should have been allowed to fail. Damn yankee socialist capitalists, eh

Yes

[Rei Murasame]

On the contrary propping up inefficient industry just leads to more inefficiency.

Which is an interesting statement to make, seeing as Toyota - the very car company that was being discussed - has been propped up by Japan since the moment of its inception, and even took a bailout early in its first attempt.

Socialists don't understand the complexities behind cause and effect and therefore ignore the fact that rewarding something creates more of it.

I don't know if socialists are understanding it, but I understand it, which is why there are some situations where I do indeed think it's a good idea to 'reward failure' for a while and see what happens, while creating circumstances that might be able to turn that failure into a success.

Also, it is easier to collapse a supply network that it is to build it up. Once you lose the capability and get rid of the staff, if you decide in the future that you'd quite like to have those capabilities again, it's too late because those skills will have all gone elsewhere, outside your country, and the start-up cost will be so prohibitively high and risky that no one will want to bring it back to your country again.

Furthermore, their confidence will be less because they'll remember that you 'let them fail' last time.

[colliric]

Which is an interesting statement to make, seeing as Toyota - the very car company that was being discussed - has been propped up by Japan since the moment of its inception, and even took a bailout early in its first attempt.

I don't know if socialists are understanding it, but I understand it, which is why there are some situations where I do indeed think it's a good idea to 'reward failure' for a while and see what happens, while creating circumstances that might be able to turn that failure into a success.

Also, it is easier to collapse a supply network that it is to build it up. Once you lose the capability and get rid of the staff, if you decide in the future that you'd quite like to have those capabilities again, it's too late because those skills will have all gone elsewhere, outside your country, and the start-up cost will be so prohibitively high and risky that no one will want to bring it back to your country again.

Furthermore, their confidence will be less because they'll remember that you 'let them fail' last time.

Toyota was a small manfacturer for a smaller market that was looking to expand overseas into western markets, while satisfying it's Japanese investors. Protectionism comes into that situation, which is why it makes sense that the Government supported a company from it's own shores. It's a Japanese company looking to the Japanese Government for support. It's diffrent when the company is a foreign company. Despite their history here, both Holden and Ford(and Toyota) are foreign in both ownership and origin. Toyota is not an Australian company, so cannot expect the same level of protectionist support.

If you want a local example, Telstra has been protected by the Aus government since it's inception(Huawei got sharfted!), the Australian courts protected Hungry Jacks from it's Franchiser(Burger King).

If you want a Japanese example of a Company that fought tooth and nail for 100 years to survive, then finally broke through to the USA market in the 1980s, with little to no support from anyone(least of all the Japanese Government), google "The History of Nintendo"!

[Rei Murasame]

Well, my counter-example would be India. India has been using subsidies on petrol and diesel that were specifically designed to prop up the car sales of Foreign-Local joint venture companies, and now they are also designing a subsidy which basically gives money to electric vehicle manufacturers starting in 2014.

Long story short, India was effectively protecting Suzuki.

[foxdemon]

Yes

And you would say the liberals on Wall Street are a bunch of socialists?

[colliric]

[

And you would say the liberals on Wall Street are a bunch of socialists?

Yep, Fabians....

Also known as the "Slow and Steady" socialists.

[mikema63]

Wall Street is socialist? Why didn't anybody tell me that socialists were exploiting labor now?

[colliric]

Wall Street is socialist? Why didn't anybody tell me that socialists were exploiting labor now?

Wall Street is dominated by Fabian pricks....

They may be exploiting labor, but that doesn't disqualify someone from being a Socialist.... Just ask Stalin and Hitler!

[Rei Murasame]

Wall Street is dominated by Fabian pricks...

Show proof or declare yourself under the influence of egg-nog!

Seriously.