Toyota Australia Posts Record Loss

Mike Stevens | Jun 27, 2014

Toyota Australia has this week joined Holden in announcing an unenviable record, confirming a $437 million loss for the last financial year - its worst ever.

The news follows the May announcements of a biggest-ever $552.8 million loss for Holden and a $267 million loss for Ford - the blue oval’s second worst year on record.

Toyota confirmed in February that it would follow Holden and Ford in ending its Australian manufacturing program, described by chairman Max Yasuda as “a loss-making business despite our best efforts”.

Toyota Australia president Dave Buttner said that despite positive results in other areas - reducing costs and securing investment to build the refreshed Camry - much of Toyota’s losses could not be saved.

“There were too many external factors beyond our control that made it unsustainable to continue building cars and engines in Australia in the mid to long term future,” Mr Buttner said.

"This has obviously had a significant impact on our results as our focus is now on supporting our employees and ensuring that we have the correct provisions in place as we transition to a national sales and distribution company."

Restructuring costs over the past financial year (unlike Holden and Ford, Toyota runs on the financial year of its Japanese homeland) have cost the company $889 million, including $505 million in asset write-downs and $384 million for employee redundancy packages.

The company reckons that if not for these costs, it would have been on track for a $266 million profit.

In the 2012/2013 financial year, Toyota Australia posted a $144 million profit, while this year the carmaker’s global profits topped a huge $19 billion.

Mr Buttner was upbeat on the brand’s sales strength however, highlighting its market position and the popularity of the imported Corolla range.

"Toyota retained its overall market leadership for the 2013 calendar year for the eleventh consecutive year," he said.

"This was led by Corolla being named the highest-selling vehicle last year and strong sales from a number of our vehicles, including HiLux and the locally built Camry.”

He added that, while local production continues, the company’s export program remains a significant part of its overall business plan with more than 67,000 vehicles exported to the Middle East, New Zealand and South Pacific Islands.

Toyota Australia currently employs 3,900 people throughout Australia.

Some 2500 Toyota manufacturing employees are expected to lose their jobs before local production ends.

The Australian Council of Trade Unions estimated in May that Australia will lose up to 50,000 direct skilled jobs, with an impact on the economy of as much as $21 billion.

MORE: Toyota announces exit
MORE: Holden announces exit
MORE: Ford announces exit
MORE: All Australian manufacturing news

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Filed under: Featured, Toyota, manufacturing, australia, News, finance, industry, mike stevens

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  • Kermit says,
    5 months ago
    An estimated $266M doesn't sound like a big profit when you consider the banks are 100 times this each year between the four of them.
    • MotorMouth says,
      5 months ago
      1 like
      But think how many employees your average big 4 bank has compared to Toyota Australia. On a per-employee basis I think Toyota would be doing much better if it could muster a $200m profit.
  • Dee Tails says,
    5 months ago
    Yeah whatever, these profit/loss statements are all flubber. Multinationals transfer capital across borders to make the number fit the narrative. Maybe this 'loss' supports their hard luck story here about having to fund sacked workers but fleeting $ bolsters the numbers to obtain a hand-out from the government in some other production centre. Turn the page and let's start building electric - use Tesla tech to restart a green car industry. All we will be making here is 10 years is excuses.
    • Steve says,
      5 months ago
      They've been trying to leave Australia for years so no surprise. Were they making a profit at all in the last 10 years (excluding government assistance)? Doubtful.

      I'm glad to see manufacturing close in this country, going to make people realise one day when they apply for a job and they can only find anything as a service sector worker... because you know, there's unlimited numbers of service sector jobs in this country. Wait until they allow foreign workers to fill those jobs too, and they allow foreign ownership of the big banks... bad times for the small workers in this country. Good for big multi nationals though with cheap labour!
    • John Sainsbury says,
      5 months ago
      Yes! Lets make electric cars for the masses. Not likely until such time that you can drive for more than 500klm, then wait for 6 to 12 hrs for recharge, Surely in this day and age, electric generators can be incorporated in each wheel to have a continuous charge, so not have to rely on external recharge!
      • matt says,
        5 months ago
        1 like
        lol you are broadly speaking about perpetual motion, not going to happen for 500 years if ever. Read up on it.
  • adam says,
    5 months ago
    1 like
    I say blame the Unions
    • Urban Slime says,
      5 months ago
      3 likes
      You must be a coalition voter. Do you want to kick a refugee too? Tosser.
  • hammer
    Hammer says,
    5 months ago
    1 like
    I hate to admit it (but which most of us secretly already knew), that our small market and first world level wages just doesn't support profitable car manufacturing here.

    It's sad but unfortunately true.
    • matt says,
      5 months ago
      pish posh, we could make cars here, we just have to have our own company and build a range of cars and export the world over, germany is around 80 million people, do you think BMW, VW, Merc and opel could all survive there in a free market with no protection building just one, maybe 2 cars each?. We sold out decades ago when we let holden go, governments fault. Not unions like some troll up there said, wages do not add up to 400 million a year.
      • hammer
        Hammer says,
        5 months ago
        2 likes
        Yeah, but Germany is surrounded by other markets pretty much right at its door step. Our closest neighbour is still across the ocean.

        But looking at population alone, Germany still has 4 times the population of Australia. Thus 4 times potential HOME market. Then add the other 200+ million people around it, it's a market as big as North America.
        • John Sainsbury says,
          5 months ago
          1 like
          Agree! Seems to have stirred up some people!

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