By on February 21, 2014

Toyota Altona Engine Plant

Sources close to Toyota say the engine plant in Altona, Australia will likely be relocated to Siam Toyota Manufacturing in Thailand once the automaker ceases Australian manufacturing operations in 2017.

GoAuto reports that while the company hasn’t officially announced what will happen to the $331 million AUD engine plant thus far, executives inside Toyota Australia have Thailand in mind as a potential new home for some of the tooling currently in use. The factory exports 16 percent of its 2.5-liter four-cylinder engines to Thailand and Malaysia for fitment in Camry and Camry Hybrid models.

Another reason for the move to Thailand? While Toyota Australia builds 100,000 Camry, Camry Hybrid and Aurion models annualy — 70 percent for export markets, such as the Middle East — Toyota Thailand builds 880,000 units annually, exporting a wide range of vehicles to Australia and Association of Southeast Asian Nations — or ASEAN — member states. Furthermore, a free trade agreement between the two countries means vehicles, such as the HiLux and the Corolla, from Thailand enter Australian ports duty-free.

The plant, partially funded by a $63 million AUD contribution from Australia’s Green Car Innovation Fund and opened at this time last year, will close halfway through its expected lifespan of 10 years in 2017, shedding 2,500 jobs with thousands more down the local supply chain in the process.

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23 Comments on “Toyota Australia Engine Plant Moving To Thailand After 2017...”

  • avatar

    “Furthermore, a free trade agreement between the two countries means vehicles, such as the HiLux and the Corolla, from Thailand enter Australian ports duty-free”

    Thar she blows.

  • avatar

    It’s been an ugly couple of months for Australia with announced closures coming from GM, Ford, Toyota and now Alcoa as well.

    • 0 avatar

      Alcoa because the Chinese have bought up the market,making it impossible to smelt Aluminium

      • 0 avatar
        Big Al from Oz

        Another area that will impact Australia is the Indonesian ban on the export of ores. The Indonesians want to develop their own metal processing.

        If this is to occur we will hurt in the shorter term, but in the longer term it’s better for Australia.

        The Indonesians are the fourth most populous nation and will require many commodities and agri products as they become more affluent.

        I have read that the average consumption of beef in Indonesian will rise from 2kg per person per annum to 20kg within a decade.

        Also, Indonesia only has 36 vehicles per 1 000. There is also going to be a huge expansion in their vehicle market.

        My view of Australia is why not just go out the back and dig up a wheelbarrow of dirt when you need some money. Just like having an almost endless bank account. Or, just plough a field and plant some crops, or let cattle run around millions of squares miles. Food the most basic of consumer product and we do it the best.

        The world will always need food and commodities, irrespective of what state they are in. Australia is the first port of call before any consumer item is manufactured or even grown. We have what the world needs to produce.

        Australia is a leader in these areas, so why not captialise on it. Lots of science and engineering is required for this. We can’t compete building cars and engines.

        In many decades from now (actually a couple of hundred years) we should worry.

        • 0 avatar

          There is a ton of risk in relying heavily on ag and natural resources; you’re at the whim and fancy of social/political/environment fads and it does not foment (and actually counters) seeds of innovation and value creation.

          Australia could compete building cars and engines, if it weren’t for its highly unfavorable business environment; esp. taxes, labor and regulation.

  • avatar

    Yeah, I kinda feel sorry for Australia; one of my favorite places in the world.

    • 0 avatar

      Meh, you shouldn’t feel sorry, even kinda. They chose to put themselves into this situation, and put a lot of time and effort in doing so

      Australia’s profound errors in following the Euro-socialist socio-economic model is there is no golden goose to leech from (Germany), no partner ship in a cabal of socialist states, and little homegrown economic value creation.

      • 0 avatar

        Now there is a reply that does not make sense. ” Cabal of Socialist States” lost me there Sunshine.

        • 0 avatar

          No worries, I’m a nice bloke and will help by explaining things a bit better.

          The “cabal of socialist states” is the European Union, usually abbreviated “EU.” This is a union of middling countries on the pseudo continent of Europe. They bandied together some years ago as many were on the precipice of failing in one form or another owing to their socialist and anti-freedom culture and policy; most notably the creation of a pan euro central bank and leaching off of Germany’s enormous economic output.

          Australia decided to copy the softer/gentler (as opposed to the Ruskies and ChiComms) “EU” socialist model by adopting its more friendly aspects – gun control, national healthcare, sky high taxes, anti-employment laws, anti-liberty laws (gun control, anti-blasphemy law, etc.), and my personal favorite, unrepentant impunity-squirting GWism. Unlike the “EU” Australia has no external central bank or next door juggernaut trade partner from which to leach.

          The post continues with criticism of Australia’s notable lack of value creation (and hence, severely diminished opportunity for determinism) owing to killing off one of their largest industries in a few short years. Those blokes have a huge natural resource industry but there’s no value created. Thus, Australia is failing and there is no stopping it.

        • 0 avatar

          > Now there is a reply that does not make sense. ” Cabal of Socialist States” lost me there Sunshine.

          Poe’s Law.

  • avatar

    Crikey mate! Dey terk errr jobs!

  • avatar
    Big Al from Oz

    It’s sad to see these jobs go. It appears the manufacturer’s have received the message, Australia will not subsidise employment or industry.

    At least our industry is rationalising with structure and not like the Europeans and even the US, where overnight many lose their jobs as plants shut down.

    This again highlights problems confronting other advanced economies.

    1. The countries that are subsidising, what will happen when the governments can’t afford to support ‘industrial welfare’.

    2. How competitive are our labour intensive consumer industries and are they sustainable.

    I would also like to see what vehicles Australians do buy as Falcon, Commodore and Camry replacements. I would think small to medium sedans, small to medium CUVs and of course diesel midsize dual cabs.

    • 0 avatar

      I agree it is sad for the people losing their jobs and/or livelihoods but the government will subsidize those people, just like the unemployed in America get a check, medicaid, foodstamps and free cell phones from Uncle Sam every month.

      However from a purely business perspective, as in making money and doing the most good at the least expense to Toyota, moving to Thailand just makes sense.

      My guess would be that Thailand is giving Toyota HUGE incentives to move there, much like the US did when the US government invited Toyota to set up shop in America.

      Australia is a modern, fully developed Western nation — a wealthy first-world country and society, and probably not willing to match the incentives Thailand offered Toyota.

      • 0 avatar
        Big Al from Oz

        In Australia unemployment benefits don’t cover free phones etc. I do know organisations like the Salvo’s do provide food.

        Even though we have a comprehensive social welfare system it is means tested and recipients of welfare are challenged every week on why they are receiving welfare. Our welfare system has been described as the best governed and managed globally. Why not it’s my taxes.

        Also, we don’t have the ‘hidden’ unemployed like you do in the US. So if our unemployment rate is at 6% means more or less 6%.

        We also don’t look at jobs created like the US, where you will have one person working 2 or 3 jobs, that means one person is employed. We do have people working up to several jobs, but it still considered one person employed.

        Monthly job numbers are meaningless unless they show actual employment or underemployment.

        Also, if you are unemployed and you have money in the bank, you must use that money first. The same goes for retirees’, like myself, I will be fully funded and not receive any government social welfare other than basically health.

        But we have a different system of retirement, whereas 10% of my income pre-tax must be (compulsory) invested into a superannuation investment fund. This increases labour costs, but the world will soon see in a decade or so that Australia will not have as huge a social welfare bill as the socialist US/Euro system of retirement.

        The odd thing about superannuation was the unions came up with that idea. Invest in the companies, odd one that, people (unionist) now want a good return on their superannuation investment.

        The system can improve. The government is implementing ‘work for the dole’. So, would you rather have a job at the minimum wage of $18 per hour or the $6 per hour on welfare? Great incentive.

        Our best idea is student loans. The government pay for your tertiary education and you pay an additional tax when you work and earn above the minimum pay. The cost of university courses is made against demand, so if Australia requires engineers and not accountants, engineering degrees are discounted and accounting degrees increased.

        • 0 avatar

          Interesting and informative. Especially the part of “and you have money in the bank”.

          Maybe that’s why so many people in America keep their money in their proverbial mattress. Others keep it in a gun safe, like I do.

          But I guess you have to have accumulated money to begin with. If you don’t have it, you can’t stash it away, or otherwise keep it out of sight.

          I am coming around to seeing the wisdom of keeping one’s wealth out of plain sight of the authorities, something that many Americans already knew and applied to their own lifestyles long before I got wise.

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