Car industry job losses extend beyond factory floor

THE collapse of car manufacturing will wipe out thousands of white-collar jobs at Toyota, Holden and Ford, it has emerged -- and, contrary to earlier claims, it will likely lead to the closure of dozens of Holden and Ford dealerships across Australia.

A combined total of more than 2000 office workers support the manufacturing and logistics operations at Australia’s three car makers and their roles will be redundant once the factories close by the end of 2017.

It will bring the true tally of job losses to about 8000 at the car makers alone, once white-collar workers join their 2500 colleagues on the factory floor at Toyota, the 1700 at Holden and the 1500 at Ford. “There will be significant (white-collar) job losses across all three brands, no question,” a Toyota executive told News Corp Australia.

Meanwhile, despite advertisements declaring their commitment to Australia, both Holden and Ford have the unenviable job of rationalising their dealer networks. As a study by News Corp Australia shows Holden has more dealerships than market leader Toyota but sells about half as many cars. Ford has almost as many dealerships as Toyota but sells less than half as many cars.

Sales of Holdens and Fords are at 20-year lows and are likely to fall even further without the preferential treatment given to Australian-made cars in government purchasing contracts. Each Toyota dealer sold an average of 1000 cars last year while Ford and Holden dealers sold an average of 440 to 480 cars respectively.

By comparison, Mazda dealers sold an average of 825 cars last year while Hyundai outlets sold an average of 625 cars. Holden and Ford would not speculate which dealers were vulnerable, citing “commercial in confidence” agreements, and repeated their commitment to remaining in Australia “in the long term”.

But senior sources at both companies told News Corp Australia dealer numbers would likely be cut due to “natural attrition” rather than termination of contracts. “Ford’s plan since we announced the transformation of our business is to promote profitable and viable dealers,” said Ford Australia spokesman, Wes Sherwood.

When asked to comment on industry rumours that half a dozen Ford dealers were about to close, Mr Sherwood said: “We don’t comment on discussions with our dealers.” General Motors spokesman George Svigos said Holden dealers “cover every corner of Australia” because, in the early days, every second car on the road was a Holden.

The company had a peak of more than 300 dealers before the year 2000. Today Holden has 232 dealers, which still is more than any other car brand in Australia. Holden would not speculate how many dealers would be cut from the network once manufacturing comes to an end.

“The Holden dealer network will continue to evolve to meet customer needs as it has done for decades,” said Mr Svigos. Meanwhile, Toyota Australia’s total head office workforce today stands at 3900, but once its 2500 factory jobs go that will leave 1400 office staff fighting for their desks.

Holden’s total head office workforce today stands at 3400, but once the 1700 factory jobs go that will leave Holden with 1700 white-collar workers, many of whom are in supporting roles for manufacturing, such as purchasing and logistics. By comparison the biggest import-only brands, Hyundai and Mazda, have 200 to 250 staff respectively at their Australian head offices and yet each company sells more cars than Ford and almost as many as Holden.

Ford says it will keep about 1000 designers and engineers to help develop foreign vehicles while Holden says it will retain at least 100 designers who will work remotely on global General Motors projects. But white-collar job-losses at all three local car manufacturers -- Toyota, Holden and Ford -- are expected to top 2000 combined once the industry is shuttered by the end of 2017.

This reporter is on Twitter: @JoshuaDowling

The car industry by the numbers -- and why white-collar jobs will go

Toyota Australia head office workforce: 3900
Factory: 2500
White-collar: 1400
Total number of cars sold in 2013: 215,000
Number of cars sold per head office employee in 2013: 55
Average number of cars sold per dealership in 2013: 1000

Holden Australia head office workforce: 3400
Factory: 1700
White-collar: 1400
Total number of cars sold in 2013: 112,000
Number of cars sold per head office employee in 2013: 33
Average number of cars sold per dealership in 2013: 480

Ford Australia head office workforce: 2700
Factory: 1200
White-collar: 1500
Total number of cars sold in 2013: 87,000
Number of cars sold per head office employee in 2013: 32
Average number of cars sold per dealership in 2013: 440

Mazda Australia head office workforce: 250
Factory: N/A (import only brand)
White-collar: 250
Total number of cars sold in 2013: 103,000
Number of cars sold per head office employee in 2013: 410
Average number of cars sold per dealership in 2013: 825

Hyundai Australia head office workforce: 200
Factory: N/A (import only brand)
White-collar: 200
Total number of cars sold in 2013: 97,000
Number of cars sold per head office employee in 2013: 485
Average number of cars sold per dealership in 2013: 605