Toyota to leave Australia

[flag of convenience]

...And the working class man will struggle for the rest of his days!

 

I wonder how long the old slogan, "Australia, Paradise for the working man" will continue to apply, if already somewhat demised from its original meaning? Land of the Fat Cats and Landowners probably more apt in the Brave New World awaiting.

[flag of convenience]

So you would rather take $150k out of the system altogether or have $75k (that the mother will more than compensate for in taxes during her lifetime) going back in again through the tills and stimulating demand for the economy?

 

Too easy yes. Why should tax payers subsidise to such an extent? One may assume those on such incomes have the means to prepare for such an event. A smaller amount of say half that amount I could possibly agree to.

[Paul1Perth]

So your labour relations objectives could be summarized as "Screw the employer for what they're worth and put something aside for the inevitable collapse".

 

Well, it's certainly got a pragmatic ring to it, but I don't remember it being put like that by Bill Shorten as his pals when they go round the factories canvassing members.

 

And your hope for the future is that other competing countries are somehow predestined to suffer the same lunacy that we have here. Well, I wouldn't hold your breath.

 

Yet it doesn't have to be that way. Many other first world countries manage to maintain a manufacturing base without resorting to huge subsidies. But to do that, both unions and employers need to take a much less confrontational stance. I doubt that this will happen, so we may very well be in for a few years of Thatcheresque union bashing. And as you've pointed out, through experience, no one really wins that kind of game. None of those that actually participate in it, anyway.

 

My labour relations objectives would be negotiate the best deal I could get if I was a Union guy and if I was a CEO of a multi National company my objectives would be to pay as little as possible to the workers to maximise profits and get my multi million dollar bonus. Bit like it is in real life in a country where workers have a say.

 

I was a Union rep at a factory in the UK for British Printing Corporation. Nice place, used to make a lot of profit and was ticking along nicely. Robert Maxwell bought BPC and six months later closed the place. A few weeks after that he was dead, committed suicide and when they looked into his affairs he had bought the company and used the superannuation money of BPC to try and bail out all his other shonky business dealings. Cost hundreds of people their jobs and a lot their life savings. The rest of his family they couldn't touch and they walked away with millions between them. If only now and then they caught one of the guys at the top mismanaging things it would be great. But no they seem to get a pay off even when they stuff up and never get blamed for anything.

 

My hope for the future is that workers in china and India and other cheap places that are used as manufacturing bases get treated like human beings and not commodities to be used up. I'm not holding my breath though, too many people with too few jobs and no social security to fall back on.

 

Every car manufacturer in the world relies on subsidies. Germany is one of the biggest.

 

When I was a Union rep btw we had some great meetings with the management with good outcomes all round. The unions don't have to be confrontational. I see the likes of Joe McDonald and he makes me cringe. His type of Union man should die out pretty soon.

[flag of convenience]

The other issue are the rapidly growing wages in China, how long before they also price themselves out of business ? Is this why so many are buying up every bit of property they can in Aus so they have a place to go when China goes belly up ? Dont like the idea of selling off property and land to overseas people who dont live here as it is pushing Aussies out of the market.

 

"We are down by the head with solicitors, accountants, business degree people, who are now finding that they need to have a Masters and a PHD just to get a look in the door. Instead of fostering our labour force and trades people and the things we really need in the country."

 

This is not just the case with the top end of town. Family member did a Cert 3 to become a teachers aid, did 50 hours "free" in schools as the course required, couldnt even get an interview. So, completed a Cert 4 and another 50 "free" hours, but now qualified teachers are taking teachers aid jobs because they cant even get work. Family member is now doing a Diploma in Education Support again to try to get a job. Bottom line is there are very few jobs around, especially when you cant relocate, have no one to care for kids before and after school, and before and after school care is so expencive.

 

Of course selling property to overseas buyers is as insane as it is out of control. Chinese money obtained goodness knows where, so what do they care paying over the top for everything? They park their money in a safe country, be it Vancouver or Sydney or wherever and wait for future developments. Chinese being the world's greatest gamblers suit very well the casino housing world we live in.

 

Of course it will impact on locals ability where ever it may be to get into the market. With the wealth comes influence. All very sad and not a lot will be done until it becomes a political issue and out in the open.

Sadly greed will prevail and certain folk are making a killing doing nothing to earn it. But no qualms about selling out to overseas investors.

 

Of course the desire is to flood the market and bring down costs, just as much as it is to stimulate the economy. All rather rum, but again the interests of those in a position to amend things, differ from the 75% or more of ordinary folk who will be impacted in one way or another at some stage.

[northshorepom]

It makes me sick when the govt sincerely tells us that we can't make cars in Australia. Are they mad or what ?

The government isn't telling you that. The car companies are. The government are just saying they're not going to subsidise it

 

The cars produced in this country are very high quality

I'd say they were pretty average, personally. Not that bad but not that great. TBQH I'd expect cars from, say, Japan and Korea to be be more reliable and generally better built.

 

It's both the govt and the car companies fault at not driving the industry to produce enough cars to make it a viable operation. If we don't buy enough cars produced here why are we not exporting them ? Top Gear rated the Holden VX Commodore as one of the finest cars the had driven beating out a Jaguar and Chrysler 300.

To make them profitable, given the production costs, lack of platform sharing and high level of unique componentry and therefore tooling, they'd have to sell in many multiples of what they do now. Hundreds of thousands a year rather a few tens of thousands. That's just not realistic from any export market, where are you going to ship them to and sell them? They're not going to out-compete European cars in Europe or Far Eastern cars in Asia, the US market has a lot of protectionist barriers and anyway selling prices there are too low for Aus exports to be sold there, where does that leave? Parts of the developing world, cars are too expensive again.

 

Top Gear (was it the UK or the Aus version?) tends to like big engined petrolhead type cars, but that's not a good indicator as to what the market actually wants. I recall when GM sold Aus Holdens in Europe in the late 90s, they sold OK in small numbers because at the time the A$ was low so they could be sold competitively, but ultimately they still failed because the smaller engined versions weren't attractive versus a Mondeo or similar, the larger engined ones ran up against the likes of Bimmer 5 Series, against which they frankly aren't in the same league (remember the likes of the BMW 5 gets penalised here with the luxury car tax), QED.

[flag of convenience]

And how would the borrowed money be paid back? From a loss making car industry?

 

You say you don't want it both ways, yet you describe your son as paying his "fair share". How do you calculate this exactly? And did the fair share include a portion for propping up private car makers?

 

>>Is Norway really doing that well?

 

Er, yes, I think they are. Point being that you do need a manufacturing base, but it doesn't have to be cars.

 

The foundations for the Toyota closure were laid 5 years ago. Since then it's just been a matter of time. It's rather pointed that the union brought an injunction against Toyota to prevent them from balloting their workforce to review conditions. It probably would have been too little too late, but it just goes to show how out of touch they are. It's just really sad that many peoples lives will be turned upside down just to prove the point that, contrary to what the union officials would have you believe, differential working conditions can't go on forever.

 

Norway I recall reading is a world leader in the use and I think production of electric cars. Very heavily subsidised by the state though.

[flag of convenience]

My labour relations objectives would be negotiate the best deal I could get if I was a Union guy and if I was a CEO of a multi National company my objectives would be to pay as little as possible to the workers to maximise profits and get my multi million dollar bonus. Bit like it is in real life in a country where workers have a say.

 

I was a Union rep at a factory in the UK for British Printing Corporation. Nice place, used to make a lot of profit and was ticking along nicely. Robert Maxwell bought BPC and six months later closed the place. A few weeks after that he was dead, committed suicide and when they looked into his affairs he had bought the company and used the superannuation money of BPC to try and bail out all his other shonky business dealings. Cost hundreds of people their jobs and a lot their life savings. The rest of his family they couldn't touch and they walked away with millions between them. If only now and then they caught one of the guys at the top mismanaging things it would be great. But no they seem to get a pay off even when they stuff up and never get blamed for anything.

 

My hope for the future is that workers in china and India and other cheap places that are used as manufacturing bases get treated like human beings and not commodities to be used up. I'm not holding my breath though, too many people with too few jobs and no social security to fall back on.

 

Every car manufacturer in the world relies on subsidies. Germany is one of the biggest.

 

When I was a Union rep btw we had some great meetings with the management with good outcomes all round. The unions don't have to be confrontational. I see the likes of Joe McDonald and he makes me cringe. His type of Union man should die out pretty soon.

 

Yep. Remember the story well. Maxwell being a prime example what the present system breeds. Australia has had more than its fair share of CEO/Business crooks as well. Just read about the shady dealings that went on in this state, WA during the 80's.

 

My hope is that while I agree folk on the Sub Continent and China and Philippines are not continued to be treated as commodities, that the practise doesn't take hold in countries like Australia the same way. I'm not at all positive this will not be the case the way we are travelling.

 

Germany is indeed a good example of management worker co operation. No wonder they produce quality for the most part.

[northshorepom]

Every car manufacturer in the world relies on subsidies. Germany is one of the biggest..

 

There's a lot of smoke and mirrors in that, most of which has been put about by the Aus unions. They include things like "cash for clunkers" type schemes which have primarily been aimed at reducing emissions, with a side order of boosting new car sales. The point about such schemes, though, is that they aren't necessarily restricted to chopping in your old banger for a domestically produced car. So they aren't really domestic production subsidies at all, quite apart from whatever $ value you want to put on the environmental benefit.

 

At the same time, the unions' figures have tended to ignore remaining protectionist barriers in Aus, like the luxury car tax

 

The claim that Australia's industry is clean/unsubsidised, and unfairly competing with everyone else's massive subsidised industry is a bit of BS tbh

 

The worst country for subsidising its car industry is, of course, the US. They don't export much, though, except to their local semi-markets in the Americas. Why don't they export much, and why do they need so much propping up? Principally because their manufacturers have massive inefficiencies and liabilities, and their products are rubbish. Why is this? Many would say (including me) that this is because they lived behind a protectionist wall for years and never had to properly compete. The case against free trade is often made by people decrying globalisation and the local effects of it as if it's obviously a bad thing - but the principles of the benefits of free trade still hold as they did since Adam Smith first expounded them

[jasepom]

The government isn't telling you that. The car companies are. The government are just saying they're not going to subsidise it

Not correct, Tony Abbot has out and out said that. The fact is the govt have given up on the car industry in Australia as not viable despite many years of success. All car producing nations subsidise their industry because they offer high employment and support satellite industries. Its simply too valuable to lose without working together either through co-investment or subsidies.

 

I'd say they were pretty average, personally. Not that bad but not that great. TBQH I'd expect cars from, say, Japan and Korea to be be more reliable and generally better built.

 

That is your opinion and not one I agree with. I have driven both new model Falcons and Commodores and have been impressed by their quality.

 

To make them profitable, given the production costs, lack of platform sharing and high level of unique componentry and therefore tooling, they'd have to sell in many multiples of what they do now. Hundreds of thousands a year rather a few tens of thousands.

 

Not true, Holden already share their platform with American counterparts such as Pontiac. Also deals were being made with Law enforcement agencies to take our Commodore range of vehicles as they were especially suited to their needs.

 

Top Gear (was it the UK or the Aus version?) tends to like big engined petrolhead type cars, but that's not a good indicator as to what the market actually wants.

Both Holden and Ford have been developing smaller cars as alternatives to the traditional big cruisers that have been favoured by Australian buyers. They have been adapting to the changing market, take for example the Holden Cruze developed here. The argument that Australian car makers do not make desirable cars does not hold water.

[Xenon4017]

My labour relations objectives would be negotiate the best deal I could get if I was a Union guy and if I was a CEO of a multi National company my objectives would be to pay as little as possible to the workers to maximise profits and get my multi million dollar bonus. Bit like it is in real life in a country where workers have a say.

 

I was a Union rep at a factory in the UK for British Printing Corporation. Nice place, used to make a lot of profit and was ticking along nicely. Robert Maxwell bought BPC and six months later closed the place. ...

 

Robert Maxwell was/is a crook. What he did was illegal; stealing, basically.

 

Toyota haven't done anything illegal. So any comparison is invalid.

 

But your premise about the confrontational nature of UK and Aus industrial relations belies why both countries have seen their domestic car production fail.

 

If you look at other countries that have fostered better working relations and you'll see success. Take Japan as an example. Or Germany. Maybe because both countries built their industry up from nothing. (Don't kid yourself it was because of foreign investment after WWII; their success would have been short-lived if the people themselves didn't actively work together). Their sense of entitlement evaporated during their defeat in the war.

 

Whereas here, people are shocked when a private company decides to up sticks because they're being taken for a ride. And they even give them 3 years notice! I bet Toyota could have given 30 years notice and there'd be some sub-35-year-olds whinging that they've got a bleak future when they thought they'd got a job for life.

[Paul1Perth]

Robert Maxwell was/is a crook. What he did was illegal; stealing, basically.

 

Toyota haven't done anything illegal. So any comparison is invalid.

 

But your premise about the confrontational nature of UK and Aus industrial relations belies why both countries have seen their domestic car production fail.

 

If you look at other countries that have fostered better working relations and you'll see success. Take Japan as an example. Or Germany. Maybe because both countries built their industry up from nothing. (Don't kid yourself it was because of foreign investment after WWII; their success would have been short-lived if the people themselves didn't actively work together). Their sense of entitlement evaporated during their defeat in the war.

 

Whereas here, people are shocked when a private company decides to up sticks because they're being taken for a ride. And they even give them 3 years notice! I bet Toyota could have given 30 years notice and there'd be some sub-35-year-olds whinging that they've got a bleak future when they thought they'd got a job for life.

 

If your going to hold Germany up as such a shining example of better working relations why do people go on about how well people are paid there. Their car manufacturing is viable only because of subsidies.

 

I'm not saying Toyota have done anything illegal. Just describing what can happen when bad management is brought into the equation. It can make production costs pale into insignificance.

 

I've only read recently what a resurgence the car industry in the UK has had. It might be all foreign owned but at least cars are being made there.

[Xenon4017]

 

I've only read recently what a resurgence the car industry in the UK has had. It might be all foreign owned but at least cars are being made there.

 

You probably remember in the 80's that the UK govt bent over backwards to get Nissan to invest in Tyneside. They had a whole list of conditions attached, one of which concerned the (limit on the) unions' involvement. It was controversial at the time, but proved to be the model after which other factories followed suit. The unions at British Leyland had already shown how to run a company into the ground, so they were excluded. The result was that not one minute of downtime has resulted from industrial relations in the Nissan plant since it opened. If you want to see how cars can be economically produced look here:

http://en.wikipedia.org/wiki/Nissan_Motor_Manufacturing_UK

[Jacaranda]

http://www.news.com.au/finance/business/will-it-be-easy-for-thousands-of-toyota-holden-and-ford-workers-to-find-new-careers/story-fnkgdhrc-1226824874048

[Paul1Perth]

You probably remember in the 80's that the UK govt bent over backwards to get Nissan to invest in Tyneside. They had a whole list of conditions attached, one of which concerned the (limit on the) unions' involvement. It was controversial at the time, but proved to be the model after which other factories followed suit. The unions at British Leyland had already shown how to run a company into the ground, so they were excluded. The result was that not one minute of downtime has resulted from industrial relations in the Nissan plant since it opened. If you want to see how cars can be economically produced look here:

http://en.wikipedia.org/wiki/Nissan_Motor_Manufacturing_UK

 

The government though, like you say, had to bend over backwards to get Nissan to invest. Here we had 3 companies already manufacturing here and are now letting them walk away. I suppose it's been an OK experience for them for a lot of years though, while the dollar wasn't so high and people were Holden and Ford through and through. No problems with the union involvement and worker relations then.

 

No doubt Nissan got a big back hander to set up in Tyneside in the first place. Maybe the UK government can persuade Toyota to manufacture there too?

[flag of convenience]

If your going to hold Germany up as such a shining example of better working relations why do people go on about how well people are paid there. Their car manufacturing is viable only because of subsidies.

 

I'm not saying Toyota have done anything illegal. Just describing what can happen when bad management is brought into the equation. It can make production costs pale into insignificance.

 

I've only read recently what a resurgence the car industry in the UK has had. It might be all foreign owned but at least cars are being made there.

 

Some German auto makers did expand into Czech Republic and Poland quite some time back to reduce costs. The area of Germany I lived, close to Stuttgart, the workers had great entitlements. Not sure if the same today, but still pretty decent. I've a relative that is only in a middling role and appears to earn well. Richest part of the country. Still very affordable to live though.

[jjgibbs]

I'd be interested in the exit strategy's

[Xenon4017]

... No problems with the union involvement and worker relations then.

 

No doubt Nissan got a big back hander to set up in Tyneside in the first place. Maybe the UK government can persuade Toyota to manufacture there too?

 

There were always issues with unions. There are still in the construction industry. The difference is that the car makers have been complaining for years and the ALP turns a deaf ear. Now they've just decided enough is enough.

 

Nissan did get a good deal on the site, which was a brownfield site. But it was a one'off to get them in. They didn't receive ongoing handouts year in year out.

[northshorepom]

Not correct, Tony Abbot has out and out said that. The fact is the govt have given up on the car industry in Australia as not viable despite many years of success. All car producing nations subsidise their industry because they offer high employment and support satellite industries. Its simply too valuable to lose without working together either through co-investment or subsidies.

"Years of success"??? The companies are losing money and sales. Yes, the government have given up on subsidising the industry. Not all car producing nations subsidise their industry, the claim that Australia subsidises less than everyone else is simply not true

 

That is your opinion and not one I agree with. I have driven both new model Falcons and Commodores and have been impressed by their quality.

I think they're all right, for mass market models. Nothing stand out. If you're trying to claim they're better made than Far Eastern cars, I think you're drawing a long bow

 

Not true, Holden already share their platform with American counterparts such as Pontiac. Also deals were being made with Law enforcement agencies to take our Commodore range of vehicles as they were especially suited to their needs.

They don't share much of the platform. Otherwise they wouldn't lose so much money on them. They *used* to - when Ford/GM made equivalent models elsewhere - eg a 2003-2004 ish Holden Commodore was pretty much exactly the same as a contemporary Opel Omega. However, Ford/GM canned that sort of model back in the late 90s elsewhere, which made the small market for the Falcon/Commodore a problem

 

Both Holden and Ford have been developing smaller cars as alternatives to the traditional big cruisers that have been favoured by Australian buyers. They have been adapting to the changing market, take for example the Holden Cruze developed here. The argument that Australian car makers do not make desirable cars does not hold water.

I never said they weren't trying to sell/develop other types, but what you might think is desirable has to translate into sales and market share. Holden Cruze? OK. Doesn't sell as many as a Mazda 3 though, does it? Why? Because the market thinks the 3 is a better car.

 

Facts are facts I'm afraid, and the sales figures and (lack of) profitability of the local manufacturing arms are unarguable facts. The local arms have been swimming against the tide of the global industry (units sold is everything) for too long and the tide has swept them away. I don't take any pleasure in this - just pointing out the economics of the industry. I think YOUR implied argument that the government are to blame and have given up on the industry - otherwise it would be OK - holds a lot less water tbqh

[northshorepom]

 

The government though, like you say, had to bend over backwards to get Nissan to invest. Here we had 3 companies already manufacturing here and are now letting them walk away. I suppose it's been an OK experience for them for a lot of years though, while the dollar wasn't so high and people were Holden and Ford through and through. No problems with the union involvement and worker relations then.No doubt Nissan got a big back hander to set up in Tyneside in the first place. Maybe the UK government can persuade Toyota to manufacture there too?

Toyota are the 2nd largest manufacturer in the UK. Burnaston plant makes about 250K cars a year

[northshorepom]

 

Their car manufacturing is viable only because of subsidies..

That's just not true Paul, whatever Bill Shorten likes to claimAs per previous, typically if you delve into the figures, you will find the allegations of foreign subsidy are for the years 2008-2009, at the height of the GFC. Funny that. Most of those assistances were temporary and most were indirect - eg the cash for clunkers schemes - to encourage sales, not direct handouts or tied to domestic products. At the same time the so-called "equivalent" subsidies for Australia exclude the value of tariff protections, which is a bit of a joke.Plenty of German manufacturers make a profit

[Xenon4017]

Toyota are the 2nd largest manufacturer in the UK. Burnaston plant makes about 250K cars a year

 

Indeed. Attracting Toyota to Derbyshire was Edwina Currie's claim to fame. That and decimating the egg industry by (rightly) accusing them of harbouring salmonella. Oh, and shagging John Major I suppose. All in all it was quite a busy week for her.

[Paul1Perth]

That's just not true Paul, whatever Bill Shorten likes to claimAs per previous, typically if you delve into the figures, you will find the allegations of foreign subsidy are for the years 2008-2009, at the height of the GFC. Funny that. Most of those assistances were temporary and most were indirect - eg the cash for clunkers schemes - to encourage sales, not direct handouts or tied to domestic products. At the same time the so-called "equivalent" subsidies for Australia exclude the value of tariff protections, which is a bit of a joke.Plenty of German manufacturers make a profit

 

Tell me of one car manufacturer that isn't operating without subsidies. Not bothered about comparisons and who is getting the most, it would be too hard to work out anyway. For a lot of countries the car industry is a hot potato and would be political suicide to let fail.

[akiralx]

Toyota are the 2nd largest manufacturer in the UK. Burnaston plant makes about 250K cars a year

 

No idea of the Toyota plants' output here, but as I understand that it costs $3500 more per car to manufacture here than, say, Malaysia, if the output is the same that means an extra cost of $875m to manufacture in Australia.

[Parley]

We will still be producing the Tom Car in Australia.

 

http://www.tomcar.com.au/

[Paul1Perth]

No idea of the Toyota plants' output here, but as I understand that it costs $3500 more per car to manufacture here than, say, Malaysia, if the output is the same that means an extra cost of $875m to manufacture in Australia.

 

Toyota had a very good reason for wanting to manufacture in the EU. It gets them round the import quotas if they are manufactured there. I think they had a few options of where to be based and it came down to who gave them the most "incentive". For this one Derbyshire County Council threw in 20 million pounds to help develop the site, as well as all the other under the table dealings.