Toyota to end car production in Australia by 2017

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toyotaToyota is to end its vehicle and engine production in Australia by the end of 2017, effectively marking the end of the country’s carmaking industry.

The company said it might scale down the operations of its development and technical centre in Australia as well.

Last year, Ford and General Motors’ Holden unit also announced plans to stop producing cars in Australia.

About 2,500 jobs are set to be lost as a result of Toyota’s decision, which it attributed to high manufacturing costs.

“We believed that we should continue producing vehicles in Australia, and Toyota and its workforce here made every effort,” said Toyota president Akio Toyoda.

“However, various negative factors such as an extremely competitive market and a strong Australian dollar, together with forecasts of a reduction in the total scale of vehicle production in Australia, have forced us to make this painful decision.”

The Japanese auto giant, which first began making cars in Australia in 1963, said it “intends to provide the best support it can, including employment assistance” to those affected by the decision.

Vivek Vaidya, an automotive analyst at consultancy Frost & Sullivan, said he was not surprised by Toyota’s decision.

“Toyota was the last producer in Australia after exit of Mitsubishi, Ford and Holden,” he said. “Labour cost in Australia is too high to be price competitive in production.”

Mr Vaidya also said rival car-producing countries such as Thailand and the US were more attractive in terms of manufacturing costs.

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