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APV Automotive Components goes under
Another one bites the dust: APV Automotive Components, which produced parts for Toyota, Holden and Ford, has lost its battle for survival, making 87 workers redundant.
Another Victorian parts-maker disappears as APV Automotive Components closes
2 August 2012
THE Australian car industry has been dealt another blow with Victorian parts-maker APV Automotive Components announcing it will close its doors on August 31, less than five months after it was placed into the hands of receivers.
The closure will see the remaining 87 workers at its Coburg facility lose their jobs, and has forced Australian manufacturers Toyota, Holden and Ford to look elsewhere for fabricated engine components, fuel fillers and rear suspension arms for their locally made vehicles.
It is the second Victorian-based parts-maker to go under in as many weeks, with suspension manufacturer CMI Industries closing shop last week, putting 119 workers out of work.
APV Pty Ltd managing director Harry Hickling told GoAuto today that the group’s other three divisions – all of which operate in the automotive industry – are unaffected by the collapse of the fourth.
APV Automotive Components was placed into external administration in April after being battered by the sales decline of the locally made Ford Falcon and Holden Commodore.
All three local car-makers entered support agreements with APV at that time to extend their orders for components out to the end of August, but receivers PPB Advisory were unsuccessful in finding a buyer to extend production.
From top: APV logo; Toyota Aurion; Holden Commodore; Ford Territory and Falcon.
The demise of APV Automotive Components is not expected to impact on the rest of the APV organisation, which was split into four separate divisions in 2011 following the acquisition of the former Autoliv crash test centre in nearby Campbellfield.
The remaining divisions of the company are: APV Safety Products, which produces aftermarket seatbelts for both local and export markets; APV Vehicle Solutions, which makes protective fittings principally for the mining sector; and APV Engineering and Testing Services, which runs the crash test facility.
Both Toyota – which accounted for about 70 per cent of APV Automotive Components’ orders from the three local car-makers – and Holden have already found alternate parts suppliers, while Ford Australia has stockpiled up to 12 months of components and is seeking an alternative supplier.
Toyota Australia media and external affairs manager Beck Angel told GoAuto the company had been in discussions with the receivers since April and had found an alternate supplier of fuel filler pipes and suspension components for its Victorian-built Camry and Aurion sedans.
Ms Angel said production at Altona would not be cut or even interrupted as a result of the switch to the new supplier.
Likewise, Holden said in a statement there would be no direct impact on production at its Elizabeth facility in South Australia.
“APV direct supply to Holden is minimal, however, Holden has been in discussions with the receiver and supportive of attempts to successfully restructure APV,” it said.
Ford – which last month laid off 440 workers in Broadmeadows and Geelong as it reduced production levels – is also anticipating no disruption of its assembly line.
Ford Australia brand communications manager Neil McDonald said the company had stockpiled a substantial supply of APV parts, including fabricated engine components and fuel filler pipes.
In April, Ford attributed lower-than-anticipated early sales of its gas-powered EcoLPI Falcon variant to supply issues stemming from APV’s initial slide into receivership.
Mr Hickling said it was business as usual for APV’s remaining three divisions, which were performing strongly and not dependant on the manufacture of original equipment (OE) for local car-makers.
“What’s remaining of the APV business is not Australia OE automotive dependent,” he told us.
“Vehicle Solutions has just had its best month ever because it is supporting the mining industry in Queensland, and its production is stronger than it’s ever been,” he said.
Mr Hickling said the Safety Products arm was exporting coach and forklift seatbelts to the US and producing harnesses for military applications for both Bushmaster in Australia and Navistar in the US, while the testing centre made most of its revenue from non-OE clients such as the Australasian New Car Assessment Program (ANCAP).
He said the demise of APV Automotive Components could even be a positive for the Australian car industry, with local manufacturers likely to re-source their orders to other local suppliers.
“My understanding is that some of the work has been re-sourced to other companies in Australia and I think that’s positive in terms of strengthening the Australian supply base,” he said.
“From my perspective, I’m very supportive of the three OEs, and hopefully they’ve taken the opportunity to further strengthen their supply base in terms of resourcing activity of automotive components.
“It’s obviously a pretty sad day to see the business closed, but hopefully the OEs have got some value out of it in terms of strengthening existing suppliers.”
Australian Manufacturing Workers Union (AMWU) vehicle division acting national secretary Dave Smith called on both state and federal governments to purchase more Australian vehicles, calling the closure an opportunity to show their commitment to local manufacturing.
“This country has to work together to stop the destruction of our manufacturing sector and the thousands of jobs it provides,” he said in a statement.
“The AMWU has been calling on government at both a state and federal level to purchase Australian-made vehicles. This wouldn’t happen in other countries. They look after and protect the industries and jobs of their citizens.
“Even with Free Trade Agreements in place, competing countries will find ways to block Australian imports.
“Look at the Thai Free Trade Agreement; the ink wasn’t even dry and their government placed a tax on vehicles with engine capabilities the same as Australian-produced cars.
“Ford Australia’s plans to export the Territory to Thailand were stopped overnight. Since then it has been one-way traffic with Thai-made vehicles flooding into Australia.
“Companies like APV were put at a tremendous disadvantage.”
As recently as a decade ago, two-thirds of Australian government fleets were comprised of locally made vehicles, but that number now sits at around one-third.
Mr Smith said the union would be writing to the federal and state governments along with mayors of every council in Australia urging them to buy locally made cars.