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Ford Cuts Jobs Only Months After Receiving Government Funding

July 18, 2012 • News

Ford Australia has announced it will cut up to 440 jobs at its Geelong and Broadmeadows manufacturing plants, just six months after Julia Gillard unveiled a $34 million bailout of the company.

Picture: http://www.freedigitalphotos.net/ (ahmet guler)

The Government funding, which was suppose to create jobs, has actually backfired with the company said to be cutting car production in Victoria from 209 a day to 148. The Peak of production, in 2004, was at 300 vehicles a day, The Age reported.

The Australian Government made $34 million dollars available to Ford in Australia, securing the manufacturing of cars in the plant through to 2016. “As a result…we will actually see the number of jobs grow. There will be an additional 300 jobs as a result.” Julia Gillard stated in a news conference from the plant in January.

Samantha Hawley, from ABC asked Industry Minister, Greg Combet if he acknowledged the substantial government funding to this sector, was not actually stopping the decline.

Mr Combet said ” Well the industry is restructuring. Unfortunately, as a union official, before I went into Parliament I’ve experienced this with working people for a long period of time and the economy never stands still and our economy is strong but some manufacturing areas but particularly automotive manufacturing are doing it tough. ”

Australian Industry Group, Chief Executive Innes Willox believes the Ford announcement is yet another sign of the tough conditions facing Australian manufacturing. “The decision will have repercussions up and down the supply chain especially for local auto parts makers who are already under considerable pressure. It underlines the importance of the manufacturing industry policies being developed by both the Government and the Opposition. These policies and action by businesses themselves are critical to lifting manufacturing capabilities and boosting the resilience and productivity of the industry,” Mr Willox said.

It hasn’t been a great week for global car makers in general with French auto group PSA Peugeot Citroen announcing it will be cutting 8000 jobs in its domestic operations, caused by the sharp  downturn in the European market. News.com.au reported that PSA, France’s biggest carmaker and second in Europe to Germany’s Volkswagen, expected the European market to shrink 8.0 per cent this year.

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