Toyota Decides to Stop Manufacturing in Australia by 2017

Published Date : Feb 10, 2014

Automobile major Toyota has announced its decision to end its car manufacturing and engine production operations in Australia. Its operations will be wrapped up by the end of 2017, and this marks the sun setting on the Australian car manufacturing industry.

As Toyota prepares for the final shut down in less than three years’ time, the company will initiate the scaling down measures at its Australian technical and development center soon.

2013 saw General Motors and Ford deciding to pull out of the Australian market on account of the high manufacturing costs. Toyota’s decision on similar lines will result in the loss of another 2,500 jobs that current exist in the company. 

Toyota, which is the last company to have announced its exit from the Australian car manufacturing business, said that it made every effort to stay afloat in the country, but negative factors such as a strong Australian dollar, a highly competitive market, and future predictions of vehicle production being scaled down in Australia left the company with no option but to take this “painful decision.”

Toyota, the Japan-based automobile giant’s operations in the Australian market go back to 1963. The company has said that while the shutdown decision was unavoidable, it will be making every effort to provide support to employees that are likely to be affected by this decision.

Market analysts say that Toyota’s decision hardly comes as a surprise. After the exit of other auto majors such as Ford, Holden, and Mitsubishi, Toyota was the last producer of automobiles in the Australian market. But the latter faced the same issues as other automobile manufacturers, such as high labor costs and a high degree of competition in the market, which prevented the company from pricing its products competitively.

Car makers find other countries such as the United States and Thailand to be more profitable than Australia.