Toyota Australia to Axe 350 Jobs

Toyota is shipping 70% of its Australian production offshore, mostly to the Middle East.

The Australian arm of Toyota announced on Jan. 23 that it would sack 350 workers at its southern carmaking plant, citing "unprecedented" pressure on its operations.

Toyota Australia chief Max Yasuda said the firm would "immediately adjust its workforce" at its Altona auto plant, describing it as a necessary step given "current and anticipated" conditions.

"Toyota Australia is facing severe operating conditions resulting in unsustainable financial returns due to factors including the strong Australian currency, reduced cost competitiveness and volume decline, especially in export markets," Yasuda said.

The cuts represent about 7.5% of the plant's workforce.

Demand had failed to recover from the global downturn, with production slipping a staggering 36% since 2007, when 149,000 cars were made, to just 95,000 forecast for 2012, he added.

"What we assumed was a temporary circumstance has turned into a permanent situation," said Yasuda.

The job cuts come less than a year after Toyota scaled back production by 20%, putting staff on half-shifts, after an earthquake and tsunami devastated Japan.

Fellow car giant Ford shed 240 Australian jobs following the March 11 disaster, also citing a slump in demand for its popular large sedans.

Canberra pledged Aus$34 million (U.S.$36 million) to help prop up production at Ford's operations earlier this month, saying it was vital to both Toyota and Holden, Australia's third major auto firm, that it stay afloat.

Manufacturing Minister Kim Carr said the latest layoffs were an "unfortunate consequence of the high dollar and global uncertainty," with Toyota shipping about 70% of its Australian production offshore, mostly to the Middle East. "The harsh reality of the continuing strong Australian dollar means that Toyota's export markets are under severe pressure and they are struggling to sell enough cars to keep the Altona line at full capacity,"

"Ultimately, companies have to take tough decisions based on commercial realities to ensure that their business model remains sustainable, and that is what Toyota has done today."

The government extended a multi-billion-dollar lifeline to the nation's ailing auto industry at the height of the global financial crisis, after Ford cut 450 jobs. It also offered Holden an Aus$200 million credit line in 2009 after U.S. parent General Motors filed for bankruptcy, handing 60% of the company to Washington.

The auto industry directly employs some 46,000 people in Australia and supports another 230,000 jobs, with 219,376 cars made in the country last year and 1.01 million vehicles sold.

Copyright Agence France-Presse, 2012

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