Autodom shutdown threatens Ford, Holden production

02/11/2012 - Car production at Ford and Holden could stall next week after a key component supplier closed its doors and stood down 400 workers in Victoria and South Australia. Tim Dornin, Steve Lillebuen

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Autodom Limited blames an inability to restructure its operations despite months of negotiations with its key customers.

It produces a range of parts for Australia's car makers, including panels, hinges, bumper components and other metal items, at Dair facilities in Dandenong and New Gisborne near Melbourne and the aiAutomotive plant at Woodville in Adelaide.

"Autodom has been forced to make this difficult decision following a failure, after several months of negotiations, to come to an agreement with the key automotive stakeholders that would see the company be sustainable and allow it to diversify into new markets," chief executive Calvin Stead said in a statement.

As well as the impact on vehicle producers, the shutdown could also flow through to other component makers if car assembly is halted.

Ford said it had enough parts to continue production for the rest of this week and had already scheduled two days off early next week.

Holden said it was also carrying enough parts until the middle of next week and would do "everything we can" to minimise any disruption to its workers or its manufacturing operations.

Toyota said it had "sufficient stock" and did not expect to be affected by the closure.

A spokeswoman said the company was reviewing options to find alternative suppliers should Autodom not resume production.

Ford said it was disappointed by Autodom's actions given the recent help provided to the company.

"Ford has provided significant assistance to Autodom in recent times, including increased piece prices and improved payment terms, as well as providing support in their efforts to diversify their business," it said.

The South Australian government also revealed it had provided $6 million to aiAutomotive to support the Adelaide operations.

SA Industry Minister Tom Koutsantonis said the company had asked for more money but had been knocked back.

"It was our view that $6 million was sufficient," he told reporters on Thursday.

Source: AAP

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