More Aus. Car Industry Job Loses.

[cobramania]

It's not big news, but surprised no ones mentioned it here.

SMR Automotive, (parts maker for Ford, Holden & Toyota), are moving some production to Thailand. Up to 90 Adelaide jobs will go.

They're sighting the high Aus. dollar & high Aus. manufacturing costs as the reason.

What I don't get is, the value of our dollar shouldn't matter to local trade as no conversion will take place. Unless they are selling parts to Ford, etc. in USD or some other currency, (which I thought was illegal as USD's are not legal Aus. tender)?

Yes we all know Australian labour costs are high, but they haven't changed that much in the past few years, (wages have gone up, but not by a lot). Labour costs for local manufacture & local trade, should've been factored into initial costs & pricing of goods. Couldn't they negotiate new supply costings?

Yes this may have put up costs to Ford, etc. but then that's for their business model/decision as to take it or go with someone else.

[ryeman]

They'll pay much less for a component from Thailand .

[Hulsty]

Labour is a killer in Australia and the high dollar makes it hard to export competitively.

[cobramania]

Originally Posted by ryeman

They'll pay much less for a component from Thailand .

I bet the car companies don't pay a cent less for parts, SMR will make more money/profit.

Originally Posted by Hulsty

Labour is a killer in Australia and the high dollar makes it hard to export competitively.

From what I can tell, these parts are for the locally Aus. made vehicles, not for export. They'll now import the parts back here.

Trouble is, the Aus. dollar won't likely stay high forever. If you shut down & shift all manufacturing off OS, when the dollar falls & import costs rise, you can't just start up manufacturing back here. The workers will have moved on & factories will've been dismantled/scrapped.

It's gonna cost. Short sighted gain, long term pain.

[SB076]

Originally Posted by cobramania

I bet the car companies don't pay a cent less for parts, SMR will make more money/profit.


From what I can tell, these parts are for the locally Aus. made vehicles, not for export. They'll now import the parts back here.

Trouble is, the Aus. dollar won't likely stay high forever. If you shut down & shift all manufacturing off OS, when the dollar falls & import costs rise, you can't just start up manufacturing back here. The workers will have moved on & factories will've been dismantled/scrapped.

It's gonna cost. Short sighted gain, long term pain.

I suspect the car companies will get a discount and will pay less (it may be a lot or very little will depend)- its not that easy to move parts around there is a reasonable amount of documentation that needs to take place (depending on the parts), plus the three OEM will be advised.

[kypez]

Originally Posted by cobramania

I bet the car companies don't pay a cent less for parts, SMR will make more money/profit.


From what I can tell, these parts are for the locally Aus. made vehicles, not for export. They'll now import the parts back here.

Trouble is, the Aus. dollar won't likely stay high forever. If you shut down & shift all manufacturing off OS, when the dollar falls & import costs rise, you can't just start up manufacturing back here. The workers will have moved on & factories will've been dismantled/scrapped.

It's gonna cost. Short sighted gain, long term pain.

Think they might be trying to make as much profit as long as there is manufacturing left in Australia. Even if the dollar does drop, will it be before the manufacturing industry shuts shop in Australia? Moving to Thailand makes sense cause they can maybe start supplying the local industry there.

[DJR-351]

Originally Posted by cobramania

From what I can tell, these parts are for the locally Aus. made vehicles, not for export. They'll now import the parts back here.

Actually according to this artical 75% of SMR production is export....

http://www.dmitre.sa.gov.au/manufact...tive_australia

Headquartered in Lonsdale, SMR employs more than 500 people in South Australia and is the only Australian manufacturer of rear-view mirror systems. It supplies all three domestic vehicle manufacturers (Holden, Ford and Toyota) and is also a significant exporter. Seventy-five per cent of its output goes to the United States, Asia and Europe.

Originally Posted by cobramania

SMR Automotive, (parts maker for Ford, Holden & Toyota), are moving some production to Thailand. Up to 90 Adelaide jobs will go.

They're sighting the high Aus. dollar & high Aus. manufacturing costs as the reason.

I'm wondering if it's only the "export" part of the operation that’s moving offshore and manufacturing for the local stuff stays in SA....

[jpd80]

SMR Automotive Australia
LINK
SMR Automotive Australia has manufactured and distributed rear-view mirrors and related products for the global automotive sector for more than 25 years. The company invests heavily in research and development, engineering and design skills, and lean, automated and highly efficient manufacturing production processes.

While SMR traditionally focused on the automotive supply chain, it now competes successfully in a high-cost environment by actively pursuing a strategy based on product innovation, staff training, local technology partnerships and global customers and supply chains that include non-automotive industries.


Links to global supply chains

The company is part of the international specialist Samvardhana Motherson Reflectec (SMR) Group, which operates in 23 countries and produces exterior and interior mirrors, lighting and mirror adjustment systems, indicators, blind-spot detectors and a broad range of automotive components.

Headquartered in Lonsdale, SMR employs more than 500 people in South Australia and is the only Australian manufacturer of rear-view mirror systems. It supplies all three domestic vehicle manufacturers (Holden, Ford and Toyota) and is also a significant exporter. Seventy-five per cent of its output goes to the United States, Asia and Europe.

SMR has expertise in product design, project management, engineering and various manufacturing processes, as well as testing and global distribution. This enables it to produce well designed products incorporating complex lighting design, advanced electronics and innovative thin-film coatings for the global automotive market.

Lots of branches in other countries too...LINK

[RPO83]

Interesting to note that Toyota have done their best to remove the liability of sharing suppliers solely with FoA.

[Road_Warrior]

Hmm.

Last year it came to light that the automotive parts supplier's association (whatever they are called) used taxpayer funds to host a seminar for Thai and Indonesian government officials and auto company execs, so that the parts companies could get a foot in the door with offshore contracts. Later, they were criticised for it as being an inappropriate use of taxpayer funds - essentially encouraging Australian manufacturers to set up shop in another country.

Looks like the criticism was well founded.

[mik]

You can`t blame them for wanting to make a buck, or even just to stay afloat,
it would seem it is far less of a headache to make a buck anywhere else but Australia if your manufacturing, and i would say labour is not the only consideration, look at all the other costs, including energy/gas/water, etc,etc.