Ford Australia will close all manufacturing plants in the country in October 2016. The announcement was made by the company and will impact 1,600 jobs.
Ford president Bob Graziano made the announcement in Melbourne Thursday morning after also announcing that Ford has lost $141 million over the last financial year. The company has taken more than $600 million in losses over the past five years. Graziano explained:
“Our costs are double that of Europe and nearly four times Ford in Asia. The business case simply did not stack up, leading us to the conclusion [that] manufacturing is not viable for Ford in Australia in the long-term.”
While the Broadmeadows and Geelong plants will be shut down in October 2016, Graziano explained that Ford will continue to employ more than 1,500 people in Australia to help with research and development as well as working at dealerships past 2016.
The decision to shutter plants in Australia marks the end of an era for Ford and the country’s car industry. When the plants close, the Falcon brand will be retired by the American car company.
Unions announced that they heard the news of the closings this morning. Victoria’s Premier Denis Napthine added that he met with Ford officials yesterday to discuss the process. Unions have expressed their concern that more jobs will be lost than the initial 1,600. They expect the effect of the plant closures to flow out into the wider auto parts industry.
And while the Ford Australia plants are closing, the company will still offer other products to the country’s car buyers. Ford New Zealand spokesman Tom Clancy explained, “Ford Australia and Ford New Zealand will proceed with plans to launch updated versions of the Falcon and Territory in 2014, as well as offering other world-class products, such as the Fiesta, Focus, Ranger and Kuga.”
Clancy added that the company will also strengthen its product lineup in the country by 30 percent by 2016.
Are you disappointed to hear that Ford is closing its Australia manufacturing plants?
[Image via Marcus Wong]