Ford workers braced for pay cuts as sales slump
Monthly figures released on Wednesday by the Federal Chamber of Automotive Industries confirm that Falcon sales have dipped to their lowest levels in 53 years, with about 580 vehicles sold last month. Preliminary numbers also show the Falcon's sports utility vehicle sibling, the Territory, fell to about 800 sales during the same month.
The performances contributed to a 20 per cent drop in overall sales for the brand, compared with the corresponding period last year.
Ford Australia is halfway through a 12-day shutdown period spread across August and September. Of Ford's 1200 manufacturing employees, 750 have been stood down on half-wages during the down days, with the option of topping up their salaries using annual leave entitlements.
The August sales result followed a previous record low of 594 Falcons sales during July.
Ford will consider whether to schedule more down days at its Broadmeadows plant before Christmas. Saturday's election result will be a key consideration.
Ford spokeswoman Sinead Phipps said that six of the 12 shutdown days already flagged were attributable to changes to the fringe benefits tax. The controversial FBT adjustments, labelled by the car industry as a $1.8 billion rort, have become an important policy issue.
"The 12 days that we currently have are spread equally across August and September, and we'll see what happens in September before we decide if we need to do any more or not," Ms Phipps said.
"The [August] figures are in line with what our dealers were reporting back when the FBT changes were implemented, so there was no great surprise."
The national secretary of the Australian Manufacturing Workers Union's vehicle division, Dave Smith, disputed the significance of the FBT changes. "The government announced the changes to the FBT and it was only a matter of days that the company was out announcing more down days," he said.
"Ford have made a decision to pull the pin on manufacturing in Australia - it's no coincidence that there's been a massive drop in their sales. It's a direct result of that."
In May, Ford Australia boss Bob Graziano announced that the company would cease its manufacturing operations in Australia in 2016, citing a $600 million loss during the previous five years.
Global president Alan Mulally last month refused to rule out stopping local manufacturing before the planned 2016 shutdown.
Frequently Asked Questions about this Article…
August figures from the Federal Chamber of Automotive Industries show Falcon sales fell to about 580 vehicles (their lowest in 53 years) and Territory sales dropped to roughly 800. Those weak results contributed to an overall 20% year‑on‑year decline in Ford Australia brand sales for the period reported.
Yes. Ford Australia implemented a 12‑day shutdown across August and September at its Broadmeadows plant. Of 1,200 manufacturing employees, around 750 have been stood down on half wages during the down days, with the option to top up pay using annual leave. The company has warned more down days could be scheduled, which would further affect take‑home pay.
Ford says the 12 shutdown days are spread equally across August and September and that six of those days were attributable to recent changes to the fringe benefits tax (FBT). The company is monitoring sales and other factors before deciding if additional shutdown days will be needed.
Ford spokeswoman Sinead Phipps said six of the 12 shutdown days already flagged were due to FBT changes. The car industry has labelled the FBT adjustments a controversial issue (described in the article as a $1.8 billion rort by industry commentators), and Ford says dealer reporting after the FBT changes was in line with the August sales figures.
Possibly. Ford has said it will consider whether to schedule further down days at the Broadmeadows plant before Christmas. The company indicated it will assess September outcomes and said the result of an upcoming election would be a key consideration in that decision.
Yes. In May, Ford Australia boss Bob Graziano announced the company would cease manufacturing operations in Australia in 2016, citing a $600 million loss over the previous five years. The article also notes global president Alan Mulally would not rule out ending local manufacturing earlier than 2016.
The national secretary of the Australian Manufacturing Workers Union's vehicle division, Dave Smith, disputed the FBT explanation's significance. He said Ford's decision to announce more down days came quickly after the government announced FBT changes and argued the company has effectively decided to pull back from manufacturing in Australia, linking that decision to the sharp drop in sales.
Based on the article, investors tracking Ford Australia's local operations should monitor monthly sales figures (Falcon and Territory trends), announcements about additional shutdown days or workforce changes, any policy shifts around the fringe benefits tax, and official updates on the planned 2016 cessation of manufacturing. These items are key indicators of the health and direction of Ford's Australian operations as reported.
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