Toyota is to follow Ford and General Motors and exit car manufacturing in Australia. It said it plans to finish Toyota vehicle and engine production in Australia by the end of 2017.

TMC President Akio Toyoda said that a number of factors were behind the decision and he also appeared to highlight the impact on the industry's supply base following others' planned exits.

"We believed that we should continue producing vehicles in Australia, and Toyota and its workforce here made every effort," he said. "However, various negative factors such as an extremely competitive market and a strong Australian dollar, together with forecasts of a reduction in the total scale of vehicle production in Australia, have forced us to make this painful decision."

"We did everything that we could to transform our business, but the reality is that there are too many factors beyond our control that make it unviable to build cars in Australia," Toyota Australia President Max Yasuda said in a statement.

About 2,500 jobs will be affected when the plant stops building cars in 2017, the company said.

Toyota also said it is considering reducing the scale of the operations of Toyota Technical Center Asia Pacific Australia Pty. Ltd. (TTCAP-AU), Toyota's development base in Australia with operations related to Toyota production in Australia.  

Show the press release

Toyota to End Production in Australia by End of 2017

 

Toyota City, Japan, February 10, 2014—Toyota Motor Corporation (TMC) and Toyota Motor Corporation Australia Ltd. (TMCA), its production and sales subsidiary in Australia, decided today to end Toyota vehicle and engine production in Australia by the end of 2017.

Concerning the decision, TMC President Akio Toyoda said: “We believed that we should continue producing vehicles in Australia, and Toyota and its workforce here made every effort.  However, various negative factors such as an extremely competitive market and a strong Australian dollar, together with forecasts of a reduction in the total scale of vehicle production in Australia, have forced us to make this painful decision.”

Going forward, Toyota will work together with employees, business partners, government, local communities and others regarding specific measures.

Furthermore, Toyota is considering reducing the scale of the operations of Toyota Technical Center Asia Pacific Australia Pty. Ltd. (TTCAP-AU), Toyota's development base in Australia with operations related to Toyota production in Australia.

Particularly for the TMCA and TTCAP-AU employees who will be impacted by this decision, Toyota intends to provide the best support it can, including employment assistance.

Concerning the future of Toyota's operations in Australia, Toyoda said: “Over the 50 years that we have produced vehicles in Australia, so many people here have kept us feeling at home, have helped us grow and have supported us.  TMCA will change into a sales and distribution company, but Toyota's commitment to continue to provide great cars and services to the Australian people—something we have done for 50 years and will do for the next 50 years—will not change.  Toyota will work hard to continue its contribution to Australia.”

 

Press release from Toyota Australia:

 

TOYOTA AUSTRALIA ANNOUNCES FUTURE PLAN FOR LOCAL MANUFACTURING

Toyota Australia today announced that it will stop building cars in Australia by the end of 2017 and become a national sales and distribution company. 

This means that local manufacturing of the Camry, Camry Hybrid and Aurion vehicles, as well as the production of four cylinder engines, will cease by the end of 2017.

The decision was not based on any single factor. The market and economic factors contributing to the decision include the unfavourable Australian dollar that makes exports unviable, high costs of manufacturing and low economies of scale for our vehicle production and local supplier base.

Together with one of the most open and fragmented automotive markets in the world and increased competitiveness due to current and future Free Trade Agreements, it is not viable to continue building cars in Australia.

Toyota Australia President and CEO, Max Yasuda, was joined by Toyota Motor Corporation President and CEO, Akio Toyoda, as he made the announcement to employees late this afternoon.

"This is devastating news for all of our employees who have dedicated their lives to the company during the past 50 years," Mr Yasuda said.

"While we have been undertaking the enormous task of transforming our business during the past two years, our people have joined us on the same journey, which makes it even more difficult to announce this decision

"We did everything that we could to transform our business, but the reality is that there are too many factors beyond our control that make it unviable to build cars in Australia.

"Although the company has made profits in the past, our manufacturing operations have continued to be loss making despite our best efforts.

"Our focus will now be to work with our employees, suppliers, government and the unions as we transition to a national sales and distribution company. Support services will be available to our employees and we will do everything that we can to minimise the impact of this decision on our employees and suppliers."

Mr Yasuda said approximately 2,500 employees directly involved with manufacturing will be impacted when the plant stops building cars in 2017.

There will also be an impact on the company's corporate divisions, which will be studied over the coming months to determine what roles and functions will remain in the future. 

Mr Yasuda said that Toyota was also committed to providing support to the industry as it prepares for the end of vehicle manufacturing in Australia.

"We will work with our key stakeholders to determine how to provide the best support to our employees, suppliers and local communities during the coming years," Mr Yasuda said.

"Not only do we need to ensure our local suppliers and employees can plan for their future, we also need to make sure that we continue to produce high quality vehicles and engines for our domestic and export customers."

Toyota Australia will continue to be involved in its local communities and employ thousands of people both directly and indirectly via its extensive dealership network. 

It is the company's intention to import the Camry and Aurion vehicles beyond 2017, along with the entire range of Toyota passenger and commercial vehicles. 

 


Overview of Toyota Motor Corporation Australia Ltd. (TMCA) and Toyota Technical Center Asia Pacific Australia Pty. Ltd. (TTCAP-AU)

 

  TMCA TTCAP-AU
Location Headquarters Port Melbourne, Victoria Notting Hill, Victoria
Operations

Automobile manufacture and sales

Design and evaluation
Products Camry, Camry Hybrid, Aurion
President Masahide Yasuda Max Gillard
Established March 1959 June 2003
No. of employees

Approx. 3,900 (as of January 31, 2014)

Approx. 150 (as of January 31, 2014)

Production bases Altona Plant
Equity participation Toyota Motor Corporation: 100% Toyota Motor Corporation: 100%

Original source: Toyota