Toyota Australia invests A$330 million in new engine plant

Toyota has opened a new A$330 million (US$347.6 million) engine plant that will produce about 108,000 four-cylinder engines annually. It will be the first production facility in Australia to manufacture engines for both conventional and petrol-electric hybrid models. The company estimates that around 15% of the engines will be exported to Thailand and Malaysia. The new facility may also push the intended construction of a third model.
Australia’s Prime Minister, Julia Gillard, said at the opening of the plant, that it was a “red-letter day for blue-collar workers”, providing AUD$63 million (US$66 million) in federal funding for the project, as Labor’s commitment to the manufacturing sector.
Toyota Australia’s President, Max Yasuda, affirmed his company’s long-term objective to achieve a truly sustainable business in the country. Admittedly a true believer in local car making and Australian manufacturing, Yasuda added that the newly built engine plant is at the “heart of its manufacturing strategy”.
Senior Managing Officer of parent company Toyota Motor, Seiichi Sudo, said the company would consider increasing its investment in Australia, but downplayed reports that it would consider making hydrogen-powered vehicles in the country. He added that even with the new engine plant, there are still many challenges facing Toyota Australia.
Toyota Australia’s Executive Director of Manufacturing Chris Harrod said the Altona plant would make fewer than 100,000 cars this year and about 108,000 in 2013, with a break-even point of 80,000. Performing at these levels would secure the new investment, he said. Studies on a third local model are on schedule to be completed within the next two years, according to Harrod. He also added that Toyota Australia has lower costs than other operations in Japan and the U.S. (December 7, 2012)