Ford Australia will terminate 440 manufacturing jobs by the end of the year, due to reduced demand for the locally-built Falcon.
The news comes only months after the troubled car manufacturer accepted $103 million in government and parent funding, designated to future-proof the Geelong and Broadmeadows engine and assembly plants.
The funding – which was allocated for the manufacture of more fuel-efficient Territory SUVs and Falcons (the latter of which began rolling off the production lines in May) – was tipped to ‘safeguard’ production at Ford until at least 2016, creating an extra 300 jobs.
Victorian premier Ted Baillieu says Ford will offer the 403 Geelong and 1,068 Broadmeadows workers the opportunity to take voluntary redundancies. An equal number of jobs will reportedly be terminated from both plants.
Baillieu says help will be at hand for the affected workers: “Today's announcement by Ford is distressing news for the employees and their families,” he said on Tuesday.
“The Victorian Coalition Government will be working with Ford to ensure that the affected workers have access to appropriate assistance, such as Ford's outplacement support services and the Coalition Government's Workers in Transition Program.”
Difficult market prompts cuts
Ford says its decision to cut jobs comes as a result of reduced demand for its Falcon and Territory SUV vehicles – especially from export markets.
The car-maker has indicated that it needs to reduce production levels to match current consumer demand, particularly for the Falcon.
“Ford's announcement reinforces yet again the challenges facing automotive manufacturing in Australia as well as globally, with a high dollar, intense global competition and changing consumer preferences,” said Baillieu.
Shadow minister for innovation, industry and science, Sophie Mirabella, says the government mislead workers when it announced in January that manufacturing would be safeguarded for at least the next four years.
“At this time the Coalition feels a great deal of sympathy for the workers and their families who will be affected by these cuts,” said Mirabella.
“This announcement comes despite a $34 million injection of cash from the Federal Government in January, demonstrating that the Gillard government’s untargeted handouts just don’t work.
“As revealed at Senate Estimates earlier this year, the Government obtained no guarantees regarding the future of jobs at its Australian manufacturing plants when it signed this deal.”
Despite shedding workers, Ford claims it is still committed to manufacturing cars in Australia.