Toyota retrenches employees due to high dollar
Australian export industries continue to get hit hard by the high dollar as Toyota retrenched 350 workers from its Melbourne factory this week.
Toyota released its plans to decrease its workforce in a statement in late January. Chief executive and president of Toyota Motor Corporation Australia Max Yasuda said that the high dollar, market conditions, and loss of profits in exports were the main factors behind the job cuts.
“Toyota Australia is facing severe operating conditions resulting in unsustainable financial returns due to factors including the strong Australian currency, reduced cost competitiveness and volume decline, especially in export markets,” Yasuda said.
“Manufacturing is a vital element of our overall operations in Australia. The actions we take now to transform our business will pave the way for our future success as a leading manufacturer and marketer of vehicles to local and export customers,” he added.
Victorian Shadow Minister for Employment and Industrial Relations Tim Pallas spoke to Dynamic Export about the effect this will have on the Victorian economy.
“If we keep losing long term jobs in the vehicle manufacturing area it will have a downstream impact on other companies in Victoria and the export industry. It is a big worry,” Pallas told Dynamic Export.
“Manufacturers are definitely feeling the pinch of the high dollar. Unemployment in high profile cases like Toyota are just the tip of the iceberg,” he added.
Other car manufacturers such as Holden are also feeling the strain of the strong dollar and uncertain economic market. Holden recently received $275 million from combined state and federal governments to ensure the survival of the company for another 10 years.
Prime Minister Julia Gillard said that the joint investment was to ensure the future of Holden in the auto industry.
“In January this year we were at real risk that there would be no more Holden in Australia, that we wouldn’t have Holden here producing motor vehicles. It would have been a knock-out blow for manufacturing in this country given the importance of the auto industry to all of manufacturing,” Gillard said.
Federal Minister for Employment and Workplace Relations Bill Shorten said that the high dollar is hitting the automotive industry hard.
“Now, the automotive industry is experiencing tough times, but by the same token I’m positive that the automotive industry can see its way through the current difficulties,” Shorten said.
Car manufacturers are looking to new markets to help ease financial difficulties with Holden set to begin exporting to China.