Ford Australia set to axe 500 jobs

Australia’s struggling car industry is about to receive another blow, with car marker Ford Australia preparing to slash up to 500 jobs as sales of its key Falcon model continue to plummet.

Australia’s struggling car industry is about to receive another blow, with car marker Ford Australia preparing to slash up to 500 jobs as sales of its key Falcon model continue to plummet.

The economic downturn, high fuel prices and changing consumer tastes have weighed heavily on Ford Australia’s sales, with Falcon sales down 15% this year and sales of Ford’s other locally-produced model, the Territory, down by about 25%.

Australia’s total new car sales have fallen 3.1% this year to 80,938 vehicles.

While Ford has not confirmed the job cuts, Australian Manufacturing Workers Union chief Ian Jones met with the company yesterday and is bracing for the worst.

“This is the toughest period we’ve seen since the early 1990s. We were losing around 1000 jobs a month in the early 1990s and it’s not much better than that now,” Jones said this morning.

It is expected the job cuts will include manufacturing and office staff. In August, Ford said it would cut 350 manufacturing jobs from November as it seeks to cut its annual output by 25% or 18,000 cars.

Ford Australia will begin assembling the Focus small car in Australia from 2011, but clearly surviving until then is not going to be easy.

Ford Australia’s US parent, Ford Motor Company, has seen its share price smashed in the recent crash on Wall Street and reports emerged on the weekend that the company had even held talks with Detroit rival General Motors about a merger.

Those talks have been abandoned, but given the outlook for the global automotive industry, consolidation of some sort looks inevitable.

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