In what will be almost a year to the day after the last vehicle rolled-off Ford’s Broadmeadows assembly plant, Holden announced over the weekend that it will shutter its Elizabeth assembly plant on 20 October 2017, ending 69-years of local production. From The Australian:
Holden spokesman Richard Phillips said yesterday that more than 30,000 new vehicles would be built between now and the plant’s closure. Close to 1000 employees would remain in work until production ends…
Employees will have access to transition services and up to $3000 in approved training and $500 for financial advice. “While this confirmation isn’t a surprise for anyone and we’ve been working toward this for nearly four years, we can now confirm the actual date for our people and our suppliers,” Mr Phillips said…
Defence manufacturing, ship and submarine building would create new jobs in coming years, Senator Wong said.
Toyota – the final automotive maker – is yet to officially announce its departure date, but has stated that it will close in “late 2017”, with a new Japanese-built Camry unveiled at the Detroit Motor Show to be sold in Australia from 2018.
The official Department of Employment projection is for the closure of the car industry to cost some 27,500 manufacturing jobs over the five years to November 2020:
However, Valadkhani and Smyth (2016, Table II, p.698-701) also estimated that beyond the direct impact on manufacturers and parts suppliers, there will be a significant impact on output and tens of thousands of job losses in downstream and upstream industries, in particular the Professional, Scientific and Technical Services (PSTS) sector (see below chart).
On the uber-pessimistic side of the scale, University of Adelaide researchers, Lance Worrall and John Spoehr, estimated that the car industry’s closure could cost up to 200,000 jobs once employment multipliers are added into the mix, with about $29 billion wiped off Australia’s GDP.
Regardless, the impact of the car industry’s closure will be large and represent a big hit to the economy, particularly in South Australia and Victoria. It will also leave a big dint in Australia’s balance of payments, with Australia’s automotive industry becoming 100% consumers, not producers, from end-2017, meaning that all our cars will need to be funded by other exports or external borrowings.
You’ve also gotta love the contradictions of this Coalition Government. They encouraged the car makers to leave decrying the $500 million in taxpayer assistance paid to them only to then set aside an extraordinary $50 billion dollars to build a dozen submarines in Adelaide, in addition to another $35 billion set aside to build nine frigates locally, all to “create” around 3,000 jobs.
