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Ford heads downtown

Slashed: Ford Australia will cut its workforce by 10 per cent.

The lights seemed so much brighter last week when Bill Ford came to town. But now...

Ford logo8 Nov 2006

By NEIL MCDONALD

LUMBERED with declining sales for its Australian-built Falcon sedan and Territory SUV, Ford Australia will axe more than 600 jobs before Christmas, reducing its workforce by 10 per cent.

But the company does not expect to take further job action if large-vehicle sales continue to fall, according to spokesperson Sinead McAlary.

She told GoAutoNews this week there was no future "trigger point" at which more cuts would be taken.

"We're taking the action we believe we need now and we don't anticipate having to do any more," she said. "Our build rate and employment rate will match what we need and we'll move forward."News of the company's decision late last week came just days after Ford Motor Company executive chairman Bill Ford visited Australia and insisted that the Blue Oval's manufacturing operations here had a "long-term future".

The latest announcement came less than three weeks after the company announced it would cut Falcon and Territory production at its Broadmeadows plant by 20 per cent from November – from 450 cars a day to 360 cars a day – in direct response to a downturn in market demand.

The axe will fall on 640 employees, 450 blue-collar and 190 white-collar.

Another 200 workers will be redirected onto other projects.

The decision immediately attracted criticism from the Federal Government, which pointed the finger at the company’s failure to establish a significant export program for its vehicles – particularly in light of a $52.5 million handout it received earlier this year.

In countering some of the responses, Ms McAlary said there had been keen interest in the voluntary packages and, subsequently, Ford did not expect any forced retrenchments. She also said many workers had been at the company for a long time – 20 years in some cases – "so many are keen to move on to new projects".

"It's a competitive, fair package that we’re offering," she said. GoAuto understands workers will get 4.1 weeks' pay for every year worked.

Ms McAlary also said Ford intended to hire 350 engineers at its new Geelong R&D facility over the next 10 months, ahead of its opening next September.

27 center imageFord is not alone in having to take drastic action in recent times in response to the declining large-car market.

GM Holden shelved its third shift at its Elizabeth plant in Adelaide more than 12 months ago, which left 1400 workers without jobs, while Mitsubishi Australia has this year shed 350 jobs at its Tonsley Park assembly plant, also in Adelaide, amid weak demand for its 380 large sedan.

It was also forced to cut 1000 jobs when it announced the closure of its Lonsdale engine plant in 2004.

Industry statistics released last week show that large-car sales have declined 19.8 per cent this year. The market segment has taken a battering over the past 10 months as buyers desert the traditional big-six market for smaller vehicles.

The boom in medium-large SUVs has also ended – and fragmented with another wave of all-new entrants.

About 75 per cent of all passenger vehicles sold in Australia are now imported, aided by low tariffs and vehicle sourcing from low manufacturing cost countries like Thailand (with which Australia has a free-trade agreement) and South Korea.

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