Boston, MA 02/11/2014 (wallstreetpr) – Australia seem not to be the best market place for Ford Motor Company (NYSE:F) at the moment as the company continues to grapple with reduced car demands. This change in the market has necessitated the management to plan on slashing its labor force in the region as it tries to reduce cost of operation through maintaining a small wage bill as it prepares full closure in 2016.
The job cuts will see up to 300 personnel losing their jobs at the Australian manufacturing plant. This is in line with the company’s plan of closing its car lines in the country by 2016 after grappling with harsh market conditions for quite some time.
Impact of the closure
Daily production is expected to fall to between 80 and 90 cars compared to 133 that the plant currently manufactures. It is not only ford that is closing its doors in Australia but three of the countries four automakers have also indicated plans of closing their industry. One of the cited reasons by the automakers is depreciating value of the Australian dollar and a fall in trade tariffs that has continued to impact the industry.
Ford will officially close its doors on October 2016 with General Motors Company (NYSE:GM) expected to withdraw in December 2017. Mitsubishi UFJ Financial Group Inc. (ADR) (NYSE:MTU) had initiated the trend after it sold its last locally manufactured car in 2010.
Ford Motor Company (NYSE:F) spokesperson Wes Sherwood was quoted as saying “will have to reduce production in June by about a third, with related job losses”. The drop in production is expected to be spread in between Fords sites of Broas meadows and Geelong. Ford has seen its fortunes in the region plummet by two thirds over the past five years alone.
Ford Motor Company (NYSE:F) opened this week trading session by being stable on a slight drop of 0.87% to close the day at $14.87
