Toyota shut down manufacturing operations in Australia yesterday on October 3. Toyota was the largest automaker in Australia, and the closure heralds the end of the Australian auto industry. Analysts forecast that the collapse of the auto industry will result in thousands of job losses in related businesses across the country and billions in lost Gross Domestic Product.
Toyota is just the latest automaker to stop making cars in Australia. Ford announced it was ending operations in Australia after 90 years and closed the Broadmeadows plant in 2016 with the loss of 600 jobs. General Motors followed suit and announced they would close their manufacturing facilities next year. They will shutter the Elizabeth plant in Adelaide on October 20 with the loss of 1,000 jobs. Final plant closures come after decades of steady decline.
Toyota, the largest automaker in Australia, was unable to remain in operation after other manufacturers pulled out. The loss of other companies meant that the supply chain was too tight to generate economies of scale. The automaker also stated that the high dollar and high costs meant that making cars in Australia was no longer tenable. They closed the Melbourne plant on October 3 after 54 years with the loss of 600 jobs.
While the slow decline has prevented a sudden shock to the economy, analysts are still concerned that the full ramifications of the collapse have yet to be seen. Pessimists stress that a worst-case scenario of 200,000 job losses might be possible if other related industries close their doors. The collapse of the auto industry could cost $29 billion Australian ($22.6 billion U.S.) annually.