Toyota to Reduce Workforce to 1,300 by 2018

[csv8]

"TOYOTA Australia has released a statement this afternoon saying it expects its workforce will reduce from 3,900 people to around 1,300 by 2018.

This includes the loss of manufacturing and corporate jobs and the creation of some new roles.

The announcement comes as the company talks about its future plans for when it stops manufacturing and becomes a national sales and distribution company.

The company will consolidate its corporate functions to Melbourne, impacting its operations currently located in Sydney. The head office will continue to be based in Port Melbourne and most of the Altona manufacturing site will be retained for new and relocated functions.

There will also be a significant reduction in corporate support roles and the four Toyota Parts Centres located throughout the country will undergo major reform to improve global competitiveness.

Toyota Australia President Dave Buttner said that the decisions announced today were not made lightly and were based on an extensive evaluation process.

"This year has been extremely tough for everyone at Toyota Australia," Mr Buttner said.

"We understand that it is a difficult time for many of our employees and we are committed to supporting them during the transition period.

"These changes will provide us with the best opportunity to have a strong and sustainable base for the next fifty years and beyond."
http://www.themorningbulletin.com.au...ralia/2473825/

[aussiblue]

http://www.abc.net.au/news/2014-12-0...e-jobs/5937372

Toyota to cut 100 jobs, consolidation operations in Melbourne ahead of production shutdown in 2017

Posted 10 minutes agoWed 3 Dec 2014, 2:42pm

Toyota
Photo: Toyota will cease manufacturing in Australia in 2017. (Flickr:
James LeVeque)

Toyota Australia is believed to be cutting about 100 back office jobs as it consolidates corporate operations in Port Melbourne before ceasing the production of vehicles in Australia in 2017.

Workers were briefed by management at the company's Port Melbourne offices and when asked if it was good news, one worker said "not exactly".

The bulk of staff would be moved to Melbourne over a two-year period and the Altona manufacturing site would be retained for the new and relocated functions.

The exact number of jobs to go is still unclear but is believed to be about 100.

The company said there would be a significant reduction in corporate support roles and the four Toyota parts centres would "undergo major reform" to improve global competitiveness.

Toyota Australia president Dave Buttner said the changes would give the company the best opportunity to have a "sustainable base for the next 50 years and beyond".

"The decision to consolidate our corporate operations to Melbourne supports our long-term vision and will assist us in improving business efficiency, increase collaboration and reduce operating costs," he said.

"The intention is that the relocation will be aligned to the end of manufacturing and we will encourage our Sydney-based employees to move to Melbourne."

The Manufacturing Workers Union's Dave Smith said Toyota was considering keeping some of its engine stamping operations open but those hopes were dashed today.

"But it's very disappointing today that they've announced that they will close and that they will consolidate most of their white collar positions into the Melbourne business," he said.

Toyota told workers in February that it would close its Camry factory at Altona in 2017, with 2,500 jobs to go.

The company's head office at Port Melbourne has 326 staff and there are about another 1,000 workers in marketing, sales and distribution.

At full capacity the Altona plant was capable of producing 150,000 cars a year.

[GASWAGON]

My missus just sent me the news.....Not pretty.....Oz is going to be in a recession within two more years if not sooner.

[oxmo]

Originally Posted by aussiblue

http://www.abc.net.au/news/2014-12-0...e-jobs/5937372

Well the unions made ridiculous demands, 'fighting' for their members.
Now the company (Toyota Aus) can't afford to pay the wages of the members so they are closing up production in Aus. Can't blame them really...

[Bossxr8]

Yeah not quite buddy. It was the supplier base not being able to supply only one manufacturer that was the issue. Toyota, the richest auto maker has no trouble paying its employees.

[Rastas]

Supply issues and all the other issues stem back to the pay rate.
Too be honest im over grieving the big 3s demise in Oz, im kinda thankfull they hung around as long as they did.

[olds]

Flooding the market with cheap imports from 3rd world country's with no unions and no industry protection is what killed the Aus. industry . If you cant beat them join them comes to mind .

[commodorenutt]

The Toyota employees building the Camry in Kentucky are paid far less than Aussie employees, and there's no drop in quality - their scores are higher than Oz.

When Toyota can build the same car, and achieve an even higher internal quality score, for a bit over half the wages cost, there was no hope for Australia.

[mik]

Sad but not unexpected, you could see the way things have panned out coming from decades ago, where will we be in 20 years time as far as manufacturing goes ?

[Franco Cozzo]

Originally Posted by commodorenutt

The Toyota employees building the Camry in Kentucky are paid far less than Aussie employees, and there's no drop in quality - their scores are higher than Oz.

When Toyota can build the same car, and achieve an even higher internal quality score, for a bit over half the wages cost, there was no hope for Australia.

Cost of living is also lower in the USA, how can you compete with Thailand who get a bowl of rice a month?

[Brazen]

Originally Posted by commodorenutt

The Toyota employees building the Camry in Kentucky are paid far less than Aussie employees, and there's no drop in quality - their scores are higher than Oz.

When Toyota can build the same car, and achieve an even higher internal quality score, for a bit over half the wages cost, there was no hope for Australia.

The average Toyota employee in Kentucky is on 60-65 grand per annum, and because of no Medicare the car makers pay the health insurance for the employees and their families. Including health benefits the average US production line worker is paid the equivalent of $55 per hour, which makes the US more expensive than Australia.

The real benefit of US assembly is volume, not costs.

Unions have bent over backwards here, no pay rises for numerous years, no industrial action, maximum flexibility with casuals and putting full time staff on forced leave or part time hours during quiet times, and the eroding of conditions at every re-negotiation. The targeting of unions is incorrect and unfair. The lack of real industrial policy, a high Aussie dollar and a very fragmented market was the killer.

[commodorenutt]

What the unions spread, and reality, are vastly different things.

Like when Toyota announced their closure, and within minutes the union propaganda machine were blaming Abbott for all 3 closure announcements in 2013 - and the unionist muppets spread it far & wide on Facebook & via email. Seems they forgot that Ford's announcement was in May, under Rudd, and Abbott took power some 3 months later, but hey, let's not let facts get in the way.....blame Abbott for Ford as well......

I work for a global company, who have a fairly large division that supplies components to car manufacturers all over the world. I am in constant contact with colleagues in Europe, China, Thailand, and the USA. The Toyota wages figures I've been told came from internal company sources in the US, and were backed up with info given to me from contacts I have in Toyota HQ in Oz.

I'm going to believe them, rather the "statistics" promoted by a pumped up union agenda.

[commodorenutt]

And so others can also seek out the reality for themselves, here's a website that shows the true wages in Kentucky:
http://www.bls.gov/oes/current/oes_ky.htm#51-0000

You'll note the average is around $14-17 / hour ($30-35K) for most production type jobs. Even front-line supervisors are only on a median wage of $24/hr ($50k).

When wages were spiralling out of control in Detroit, aided by the auto workers union, the manufacturers saw a way out - and scrambled to head south of the Mason-Dixon Line, to areas like Kentucky - beyond the reach of the unions.

[b0son]

Originally Posted by Brazen

Unions have bent over backwards here

Didn't realize taking Toyota to court to prevent the existing EBA being renegotiated is what constitutes bending over backwards.

Can't link the original article (paywall), but someone copied it here:

http://www.1eyedeel.com/xn/detail/50...omment:1622230

HOLDEN is going because it is easier to spend $600 million leaving Australia than it is to get out of its enterprise agreement with the union.

Returning workers to the award wage was the only hope. The taxpayer was subsidising each Holden worker to the tune of $50,000 a year, which is, by my calculation, still less than the amount the enterprise agreement adds to the cost of each employee.

Yes, to be clear, the employment cost of the Holden enterprise agreement is well more than $50,000 per employee a year. I defy anyone to say that enterprise bargaining with the union didn't sink Holden.

No one ever envisaged enterprise bargaining would produce a crisis of this proportion. Half of the Australian workforce has been bumping along for 20 years on the centralised wage-fixing model; yearly dollar amount increases have produced modest wage growth. The other half of the Australian workforce has been receiving percentage increases of about 4 per cent per annum, compounding, for 20 years.

We are on the cusp of a major crisis, enterprise bargaining wages are now just hitting the violent upswing point in the bell curve, stratospheric wage levels are ahead of us and many of our big companies are going to fall over.

Putting wages aside, productivity inhibitors in agreements cripple the ability of a company to respond to outside pressure. Unions, jaded by constant employer exaggeration about poor finances, are not facing reality. What we are seeing now with Holden and Toyota is only the beginning.

Now that Holden has announced its departure, we need to consider the Toyota situation, which will come to a head with a vote on its enterprise agreement tomorrow. In September 2011, thousands of Toyota workers went on a protracted strike to get a 12 per cent pay rise. The company caved in; a deal with a 13 per cent pay rise between then and March 2015 was given. Base rates for technical and trade workers are in the $65,000 to $97,000 range with generous allowances, loadings and penalties on top.

The Toyota enterprise agreement lists its "purpose" as "to achieve TMCA's success as a Global Company" yet no single business contract could guarantee its failure more. This document, as much as Holden's, reflects an extraordinary level of union control over daily workplace organisation.

When Toyota wants to hire someone, a union (employee) representative must sit in every single job interview as "an observer". Heaven knows what they exactly are looking out for. Perhaps they are scrutinising for union talent or maybe their presence is to convey that Toyota is a totally union-controlled company and union membership is compulsory. A table in the agreement sets out exactly how many union representatives the company has to have in every section of the workplace and 10 paid union training days a year is given to union reps.

Toyota is allowed to hire casuals only from "time to time" and not at all without union agreement, although agreement must not be "unreasonably withheld". Casuals can perform only the "agreed specified tasks" for the "agreed specified period" mandated by the union. "The maximum period for which a Casual Employee can work continuously on a full-time basis is one month" and any casual around for six months must be made a permanent employee.

Contract labour can be hired only after Toyota reaches "agreement with the relevant Union official and Employee (union) Representative". Contractors around for 12 months must be made permanent employees.

This means Toyota can never really have a hiring freeze but are continually bound to a destructive cycle of taking people on before eventually having to make them redundant. In any case, on a monthly basis, "details of all utilisation" of all "employment categories" must be "presented" to the union.

Over-staffing must be a big problem because the agreement mandates one team leader to look after "between 5-7 process workers". Supervisors, whose base rates range from $75,000 to $103,000, are forbidden from helping with workloads. Supervisors can "assist" workers only with their "verbal agreement" in certain circumstances, such as "assistance in performance of heavy/awkward lifting or stock relocation or in the performance of minor adjustments to equipment to overcome malfunctions" and "any manual task performed by a Supervisor" must not exceed "a very limited time period".

If Toyota needs to dismiss someone, an outrageous procedure of at least three years and three months continuous disciplinary action is required before dismissal can occur. This defies belief.

The procedure can technically be shortened by a dismissal if the employee commits misconduct, but any dismissal can be reversed by special arbitration powers Toyota gave the Fair Work Commission to reinstate employees upon union request.

So, Holden versus Toyota: which union enterprise agreement is worse and will the Toyota agreement destroy the company?

Both agreements caused me to repeatedly question my own sanity before briefly wondering whether there should be a special industrial relations prison created for grossly incompetent management types.

Even though Toyota say they can bear the workforce costs as long as flexibility concessions are made, unless the union agreement is dissolved by the Fair Work Commission the company is doomed.

[mik]

With all the headaches and costs in manufacturing in oz, why would any company/employer want to put themselves through it ?
answer ? they don`t , that is why manufacturing is deserting like rats on a sinking ship.

[Wretched]

Originally Posted by mik

With all the headaches and costs in manufacturing in oz, why would any company/employer want to put themselves through it ?
answer ? they don`t , that is why manufacturing is deserting like rats on a sinking ship.

Not just manufacturing but any industry.
The costs are astronomical (building rent, council rates, utilities, taxes, wages, insurance, work cover, etc) and the red tape that has to be completed just makes AU a terrible place to do business. If I was setting one up now it wouldn't be here.

[xbman//]

Originally Posted by oxmo

Well the unions made ridiculous demands, 'fighting' for their members.
Now the company (Toyota Aus) can't afford to pay the wages of the members so they are closing up production in Aus. Can't blame them really...

yeh no i work there and the union only tried to stop toyota from reducing the steps the had to take to dismiss workers the only money discussions that took place were from the members telling toyota to keep the pay rise they were going to give us but the company wouldnt have it. toyota was going to was going to close shop and then fire people for stupid reasons so they wouldn't have to pay redundancy's

[Sprintey]

Originally Posted by Wretched

Not just manufacturing but any industry.
The costs are astronomical (building rent, council rates, utilities, taxes, wages, insurance, work cover, etc) and the red tape that has to be completed just makes AU a terrible place to do business. If I was setting one up now it wouldn't be here.

Tend to agree, but for question's sake, is there any way it is possible to set up a profitable manufacturing business in Australia under current conditions? Do design only? Automate to the level you don't have staff (eliminates many OH&S and IR issues)? Locate far away from high land prices? Pursue a niche and do it best-in-world (as the Germans do with technology)? Set up factory under water to avoid being in a council area subject to their regulations?? lol

[Wretched]

Originally Posted by Sprintey

Tend to agree, but for question's sake, is there any way it is possible to set up a profitable manufacturing business in Australia under current conditions? Do design only? Automate to the level you don't have staff (eliminates many OH&S and IR issues)? Locate far away from high land prices? Pursue a niche and do it best-in-world (as the Germans do with technology)? Set up factory under water to avoid being in a council area subject to their regulations?? lol

I've looked at underwater but no one is willing to relocate.

In all seriousness though every business all over the world has various costs associated with running everyday but in AU these costs keep on increasing at a phenomenal rate each year (utilities, land tax (VIC), etc). Increasing prices won't help as it will drive customers elsewhere.
Governments, businesses and employment groups need to work together to get some kind of framework established to encourage investment in AU, stop businesses going overseas.

[b0son]

Originally Posted by Sprintey

Tend to agree, but for question's sake, is there any way it is possible to set up a profitable manufacturing business in Australia under current conditions?

Require imports to comply with local standards, have compliance tested locally. Look at the situation with the dodgy electrical cables sold through Masters... that's going to cost our economy hundreds of millions of dollars in needless repair/rectification work all because the product wasn't appropriately certified.

Alternatively, if Europe/US don't regulate a category of products, we shouldn't either.

I work in an industry that is government-regulated. Our products have to undergo all sorts of extra testing/registration/etc before it can be sold here. The same category of products in the US/Europe have no such regulations, and are free for individuals to buy online and bring into the country.

The bureaucrats pat themselves on the back because they hide from criticism by trotting the 'public safety' argument, even though there's no evidence that the amount of regulations has protected us in any way. Meanwhile, the list of licensed Australian manufacturers is less than half as big as it was a few years ago.

We're regulating ourselves out of existence....

[Sprintey]

Cheers for the replies both of you, agree. Yeah Boson, I wonder what the point of keeping ADRs is once we don't have an auto industry and US/EU have regulations that should cover us?

The more I look at it the more I am looking forward to setting up overseas, which luckily I can do. Gotta look on the sunny side.