Supplier dispute threatening Ford and Holden production

[stevz]

http://www.news.com.au/national/disp...-1226447835210

Dispute could shut down Ford, Holden: govt
August 10, 2012 7:10PM

PRODUCTION at Holden and Ford could shut down as early as next week with as many as 4000 workers facing being stood down because of an industrial dispute at a car parts manufacturer, the Victorian Government says.

A dispute at Dandenong components manufacturer DAIR Industries threatens to cripple Victoria's automotive manufacturing sector, Employment and Industrial Relations Minister Richard Dalla-Riva said on Friday.

He said the ripple effect of shutting down supply of parts to other companies across the supply chain will be "disruptive to the extreme".

"Unless dealt with decisively, this dispute could see the production lines at Holden and Ford grind to a halt by as early as next week," Mr Dalla-Riva said in a statement.

"This alone could lead to stand-downs for up to 4000 workers, and cost these companies tens of millions of dollars for each day of lost production.

"If production shuts down across the system, it will affect hundreds of businesses, and put at risk the livelihoods of many thousands of workers."

DAIR Industries, a subsidiary of Australian automotive component manufacturer Autodom Limited, produces metal assemblies for Toyota, Ford and Holden including rear bumper assemblies, foot brakes, clutch mechanisms, hood hinges, parking brakes and car jacks.

Mr Dalla-Riva said the government supported an application to Fair Work Australia by Dair Industries to end the industrial action over pay negotiations.

[Kryton]

And they wonder why they stop buying parts from local suppliers and start shopping overseas.

[XAGSV8]

We Aussies just keep shooting ourself in the foot. India/China must be rubbing their hands together while giggling like a little school girl everytime something like this happens.

[stevz]

Yep, sadly, every time something like this happens, it is just another nail in the coffin for local manufacturing.

[prydey]

Originally Posted by stevz

Yep, sadly, every time something like this happens, it is just another nail in the coffin for local manufacturing.

i think the parts industry will dry up before local manufacturing. ford, holden and toyota will just import everything if local supply becomes too unstable.

[Road_Warrior]

Originally Posted by prydey

i think the parts industry will dry up before local manufacturing. ford, holden and toyota will just import everything if local supply becomes too unstable.

And I think not many people realise the scale and duration that this has been occuring. 'One Ford' is more than just claptrap about global platforms.

[Murph-51]

Originally Posted by prydey

i think the parts industry will dry up before local manufacturing. ford, holden and toyota will just import everything if local supply becomes too unstable.

If only it was as easy to just switch suppliers like that.
Regardless of who they use or where the part comes from, every new part or supplier introduced to the fray, means the car has to be put through all its R&D again, it all has to be tested and crash tested again, costing millions.
For example, the company that suppliers the filler necks to Ford and Holden have now closed.
Ford have 12 months supply left, where as Holden have already moved onto a new supplier

[prydey]

Originally Posted by Murph-51

If only it was as easy to just switch suppliers like that.
Regardless of who they use or where the part comes from, every new part or supplier introduced to the fray, means the car has to be put through all its R&D again, it all has to be tested and crash tested again, costing millions.
For example, the company that suppliers the filler necks to Ford and Holden have now closed.
Ford have 12 months supply left, where as Holden have already moved onto a new supplier

if ford (and holden) move to global platforms this will alleviate many of these problems. it won't be left to the small local manufacturer (ford/holden) to foot the bill.

i know i started the above statement with 'if', but more accurate would be 'when'!

[Bossxr8]

Originally Posted by Murph-51

If only it was as easy to just switch suppliers like that.
Regardless of who they use or where the part comes from, every new part or supplier introduced to the fray, means the car has to be put through all its R&D again, it all has to be tested and crash tested again, costing millions.
For example, the company that suppliers the filler necks to Ford and Holden have now closed.
Ford have 12 months supply left, where as Holden have already moved onto a new supplier

No they don't. New parts are built to the same specs as the old ones, and don't need to be crash tested again, nor do they need to repeat R&D for the whole car again.

All they do is trial some of the new parts, check they work/fit as they should, and then fit them when ok'd by PD. Minimal cost involved.

[wrongwaynorris]

Unions at work , the left wing really do live in a vacuum dont they . Work themselves out of a job then ***** and whinge theres no job .

[jpd80]

Even though they will moan publicly, I think Ford and Holden will be privately relieved that
they now have an excuse to halt production for a while and use up some stockplied vehicles.

Autodom Limited should give their workers a pay rise to get everyone back to work
but then let them know that due to rising costs, the company has to move overseas..
You watch the union jump through their own A55es after that's said.

[bobthebilda]

Originally Posted by jpd80

Autodom Limited should give their workers a pay rise to get everyone back to work
but then let them know that due to rising costs, the company has to move overseas..
.

I dont think Autodom has the ability to do anything. Its a company with 500 -600 employees (not too sure exactly since they took over DAIR), but has a market capilisation of $1.5 million on the stock market. So the market values it at $2-3 thousand per employee, and to get rid of an employee is going to cost them $10's of thousands per employee. The last financial statement i read from them is that the auditors said there were serious doubts about their trading position, their main bank has allowed them to keep trading despite breaching loan convenants, and the SA government has allowed them a longer time to pay back a $8 million loan they gave them.

And some how despite the dodgy trading position of Autodom, the Federal Government then assisted them in purchasing DAIR. The governments builds up the hopes of these employees but neglects to mention the foundations theys set are built on quicksand. GEERs is the money of last resort the government has when it realises the bad money it has spent, was chasing bad money to start with.

[jpd80]

Originally Posted by bobthebilda

I dont think Autodom has the ability to do anything. .

Yes they do but the big part is getting everyone back to work for now, Bosch is moving offshore and if they can do it, so can other suppliers.

[Bossxr8]

Not even close. Basically every panel is made in house, and the engine is mostly all Ford in the castings bar the head and the front cover.

Its mostly small parts and the electricals that are from outside suppliers. And plastics are from outside suppliers too, but they are located at Fords old plastics plant at Broadmeadows.

In terms of % of the cars weight, Ford made parts would match if not exceed what comes from outside suppliers.

[XD 351 Ute]

How long ago was it when Ford made all their own car parts, or have they always had outside suppliers.
I'd imagine there was a time when they did it all in house, surely.

In my opinion, if they did everything themselves they'd be in a much better place, and could possibly be selling exporting automotive components like most of these small suppliers are doing.

Don't Hyundai make or do everything in house, including their steel?

Ed

[neptune blue]

Originally Posted by XD 351 Ute

How long ago was it when Ford made all their own car parts, or have they always had outside suppliers.
I'd imagine there was a time when they did it all in house, surely.

In my opinion, if they did everything themselves they'd be in a much better place, and could possibly be selling exporting automotive components like most of these small suppliers are doing.

Don't Hyundai make or do everything in house, including their steel?

Ed

Car makers have always out sourced
The bottom line is that they can't do everything as it would make it unviable

[JG34JA]

Originally Posted by neptune blue

Car makers have always out sourced
The bottom line is that they can't do everything as it would make it unviable

If that's the case can you explain Henry's River Rouge complex?
Wasn't that for full integration? Why did it/didn't it work? If anyone can explain much appreciated.

[KIWI-1]

Did Henry make tyres at River Rouge?

[jpd80]

Originally Posted by KIWI-1

Did Henry make tyres at River Rouge?

Yes Ford did...

And there was a good reason why Ford went away from making things themselves,
external suppliers competing against one another drives the price down below Ford's manufacturing price.

[KIWI-1]

Originally Posted by KIWI-1

Did Henry make tyres at River Rouge?

Originally Posted by jpd80

Yes Ford did...

Well the Model A was probably the first to be completely in house then. I wonder when "approved accessories" started? Might have to dig out my Model T handbook.

[jpd80]

Originally Posted by KIWI-1

Well the Model A was probably the first to be completely in house then. I wonder when "approved accessories" started? Might have to dig out my Model T handbook.

Do you mean outsourcing parts from approved suppliers?

[neptune blue]

I suppose the easiest way to explain this is
It would be like the builder that built your house owning a forest and a saw mill for the framing timber then making the bricks from scratch, cast the glass for the windows extrude the aluminum for the window frames etc

It's not practical
Now let's fast forward to the 21 st century where the builder sources parts for the house form specialists that can make bricks faster and cheaper than he can can because the brick maker not only has all the equipment and know how but makes bricks to supply dozens of builders so he can make them cheaper cos that's all he does

If it was cheaper to do everything in house dont you think these multi billion dollar company's would be doing it

[mik]

well if it was practical to make most parts here , it`s becoming too much of a headache in this country for so many reasons, i will be very surprised if we make any cars here 10 years time.

[Cúl-Báire]

http://au.news.yahoo.com/a/-/latest/...parts-dispute/

A Melbourne car parts manufacturer has made an offer to employees in a bid to
end a pay dispute that threatened thousands of jobs in the Victorian car
industry.


And the union says it's a reasonable offer.


Dandenong components manufacturer DAIR Industries managers met workers and
union representatives on Sunday at Fair Work Australia (FWA) for urgent
conciliation talks to end the pay dispute.


The Victorian government had warned on Friday that the dispute could shut
down production at Holden and Ford as early as next week, with up to 4000
workers at risk of being stood down.


Following conciliation talks, Australian Manufacturing Workers Union (AMWU)
Victorian secretary Leigh Diehm said management had made an offer the union
could recommend to workers.


"We feel that we've got to a position where we can go and recommend something
to our members," Mr Diehm said.


"There's a reasonable offer that's been put on the table."


Workers will vote on the offer at 7pm (AEST) on Sunday.


Mr Diehm said he was happy with the offer but the outcome would depend on the
workers' vote.


"I think we've moved significantly today on both sides," he said.


Federal Workplace Relations Minister Bill Shorten, who attended Sunday's FWA
talks, criticised the Baillieu government for failing to show up.


"The Victorian government has been missing in action," he told reporters
outside the hearing.


"They were very quick to issue press releases about how dreadful this dispute
was.

[KIWI-1]

Originally Posted by KIWI-1

Well the Model A was probably the first to be completely in house then. I wonder when "approved accessories" started? Might have to dig out my Model T handbook.

Originally Posted by jpd80

Do you mean outsourcing parts from approved suppliers?

I guess that depends on the definition of outsourcing parts from approved suppliers. At least as early as 1935, Ford produced brochures advertising "approved accessories" made by outside companies - see below.

[jpd80]

Originally Posted by Cúl-Báire

http://au.news.yahoo.com/a/-/latest/...parts-dispute/

Thanks for that informative post Cúl-Báire,

Let's hope there's a speedy resolution..

[BroadyFord]

Good that work will continue but at what cost?

Auto parts workers reach deal, end dispute


http://www.theage.com.au/victoria/au...812-242em.html

A crisis in Australia's car making industry was tonight averted when about 140 striking workers at a Dandenong auto-parts factory accepted a revised industrial relations deal and agreed to return to work.

After a day of crisis talks before the industrial umpire, workers at aiDair Industries tonight accepted an in-principle compromise deal over redundancy provisions, which had been a sticking point in six months of enterprise bargaining talks.

The workers had been picketing since last Wednesday but agreed to return to work tomorrow.

Earlier, the company, which makes car parts for Holden, Ford and Toyota, and two unions - the Australian Manufacturing Workers' Union and the Australian Workers Union - reached a compromise after five hours of talks behind closed doors with the industrial umpire, Fair Work Australia Commissioner Wayne Blair.

The workers had been picketing since last Wednesday but agreed to return to work tomorrow.

The picket had prompted fears that if it dragged on, production at the car makers could grind to a halt this week as they ran short of vital parts. AiDair makes rear bumper assemblies, foot brakes, clutch mechanisms and bonnet hinges.

Australian Manufacturing Workers' Union assistant state secretary Leigh Diehm said today he was happy to recommend the revised offer to members, as the company had come up with a "reasonable offer".

AiDair Industries' general manager of operations, Kevin Boyle, said the dispute had been "damaging to everybody" and that the car makers would have been unable to produce vehicles had the dispute not been settled.

Federal Employment Minister Bill Shorten, who had talked privately with all sides, arrived at FWA's Melbourne offices shortly after the official talks broke up.

Mr Shorten said today's hearing showed the government's industrial relations system worked, but conceded the dispute had cost both company and workers.

"Sometimes it does take the sharp end of the debate to focus minds on what people have in common, as opposed to what divides them," he said.

Opposition industry spokeswoman Sophie Mirabella said the dispute was "yet more evidence" the Gillard government did not understand the car industry and had ineffective policies.

"This government spent $34 million in January of this year on a bail-out that failed to save 440 jobs. Now their failure to legislate or intervene effectively could end up costing the industry this and more," she said.

Mr Shorten said Ms Mirabella was "conspicuously absent from the field of negotiation".

[BroadyFord]

A few more details here.

More than 52 weeks redundancy pay, which in my opinion is obscene! (Having said that I don't know what is generally considered average redundancy pay but it seems excessive).

I'd be interested to know if there were any commitments from the union to enhance productivity or be reasonable on other issues.

[Wretched]

Originally Posted by BroadyFord

A few more details here.

More than 52 weeks redundancy pay, which in my opinion is obscene! (Having said that I don't know what is generally considered average redundancy pay but it seems excessive).

I'd be interested to know if there were any commitments from the union to enhance productivity or be reasonable on other issues.

excessive is not the word i would be using...

[robbo/region15]

Originally Posted by BroadyFord

A few more details here.

More than 52 weeks redundancy pay, which in my opinion is obscene! (Having said that I don't know what is generally considered average redundancy pay but it seems excessive).

I'd be interested to know if there were any commitments from the union to enhance productivity or be reasonable on other issues.

In days gone bye a retrenchment package was:
1. 4 weeks in lieu
2 . 4 weeks for every.year
3. All sick pay paid out.
4.Long service paid out.

These days its been whittled down to capped at 26 weeks pay capped.So someone with 30 odd years service get stuff all.