CANBERRA: The Australian car industry is continuing to bleed red ink on its balance sheets as it prepares to shut down forever from the end of 2017. The ‘blue oval’ car brand Ford has ended another year in the red after posting a $191 million loss in Australia in 2014, as its sales fell to a historic 48-year low. It brings Ford Australia’s total losses to a staggering $1.3 billion over the past 10 years, during which time it has received more than $1.1 billion in government funding.
Ford has only posted a profit in three of the past 10 years; the 2014 loss alone evaporates the profit the car maker has reported over an entire decade: $186 million. Ford says $167.2 million of the $191 million loss was for redundancies and other costs associated with closing its Broadmeadows car factory and Geelong engine and stamping plants in October 2016.
There was one silver lining on the results: the operating loss for the rest of Ford Australia’s business amounted to $23.5 million, which is $2 million less than the previous year. It means Ford has been making more profit per imported vehicle, even though it has been selling fewer cars.
Ford Australia’s revenue was $3.1 billion in 2012 and $2.8 billion in 2013 and fell to $2.7 billion in 2014 as vehicle sales fell to their lowest since 1966. Ford Australia has received more than $1.1 billion in government funding over the past 13 years, including $72 million in 2013 and $47 million in 2014.But Ford says it spent $367 million on local engineering work for overseas Ford vehicles in 2014, up from $340 million in 2013.
Ford expects to become Australia’s largest automotive employer after car manufacturing comes to an end in 2017 (when Holden and Toyota also close their factories), with approximately 1500 designers and engineers developing foreign cars, primarily for China.”We continue to invest more than any other automotive company in Australia, including $2 billion in research and development over the past six years,” said Ford Australia spokesman Wes Sherwood.
