Last Ford rolls off the line in Australia: what's next Down Under?

October 7, 2016

Back in 2013, Ford made a sad announcement: as of October 2016, the company would stop manufacturing vehicles in Australia.

Ladies and gentlemen, October 2016 is here, and earlier today, the last Australian-made Ford--a Falcon XR6 like the one pictured above--rolled off the assembly line. Ford's Broadmeadows and Geelong factories will now begin the long process of shutting down.

When Ford made its announcement in May 2013, the company employed roughly 1,200 workers at those two plants. To date, around 500 have found jobs elsewhere, or they've transitioned to Ford's product development and customer service divisions, which will remain intact. Another 120 workers will stay onboard to oversee the shuttering of Broadmeadows and Geelong. The remaining 600 employees are jobless as of today.

Both Broadmeadows and Geelong are up for sale, but there are no reports of potential buyers, and it's unlikely that major automakers are eyeing them. As you might recall, a few months after Ford's announcement, General Motors said that it, too, would end manufacturing in Australia. Toyota followed suit within weeks

The future of Australia's auto industry

The decision to shift away from manufacturing in Australia isn't unexpected. The country's auto market is tiny compared to many others. (For reference, fewer than 1.2 million vehicles were sold in Australia last year, compared to nearly 17.5 million in the U.S.)

In other words, producing cars in Australia for the domestic market is a small-numbers game, and producing them for export isn't much better, with competing factories now deployed throughout Asia. China, in particular, is where many new manufacturing plants are being built--not only because auto sales there are booming, but also because China sets huge tariffs on imported vehicles.

But that doesn't mean that Australia will be left out of tomorrow's auto industry. Ford has said that it's growing its research and development teams in the country, and within two years, it hopes to be Australia's biggest automotive employer.

And of course, the closure of Ford, GM, and Toyota facilities could generate a boom in start-up transportation companies. There will be plenty of trained automotive technicians in Australia who might jump at the chance to work on the next Tesla.

Then, too, let's remember that it's not just Australia's auto industry that's in transition. Thanks to self-driving technology, electrification, and ride-sharing, the entire sector could soon be turned upside-down. In the best-case scenario, today's crisis could help Australia improve its strategies for tomorrow.

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