Ford, Holden both show a post-manufacturing profit

Shaking off the legacy of Australian manufacturing appears to have helped our former domestic car-makers

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FORD managed to make just $345 for each new car it sold in 2017, while Holden made the equivalent of almost $1730 on every sale, documents filed with financial regulators show.

The documents reveal Holden made a $156 million profit in its last year as an Australian manufacturer. In contrast, Ford Australia managed to make just $27 million last year, the first profit it has made in the five years since it announced it would quit local manufacturing in late 2016 becoming a full line importer.

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Holden’s financial statement also shows the Takata recall – the brand recently announced it would need to add 330,000 cars to the millions already caught up in the airbag scandal – is estimated to cost $53 million, which it said it would pass back on to the GM subsidiaries that built the vehicles.

Holden’s higher profit – well up on the $125.5 million it earned in 2016 – came on the back of $1.86 billion in revenue for the brand’s 90,306 sales, but down on the $2.33 billion it reaped the previous year. It paid $22 million in income tax, the documents reveal.

Ford, meanwhile, says it earned $3.52 billion in revenue off 78,161 sales after bouncing back from a $24 million loss posted in 2016. It paid no tax, the documents reveal, instead calling in losses from previous years to offset its taxable income.

Ford said 2017’s positive result showed the company was in line with its plans for  “transforming and growing our Australian business”.

“Our 2017 financials reflect a significant growth in our core business as we move towards sustainable profitability,” it said in a statement. “This is tempered by ongoing decommissioning costs. Ford continues to focus on refreshing our product line-up to offer more innovative products for consumers and to drive profitable growth.”

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Both Ford and Holden still maintain research and development hubs in Australia. Holden said it had invested $70.7 million on its new-product efforts in 2017, while Ford allocated a $471.5 million cost to its Australian division.

Both Ford and Holden’s 2017 income included contributions from the public purse. Holden gained $36.6 million from the Federal Government’s Automotive Transformation Scheme, while $1.6 million. Holden also made $35.6 million from the sale of its property, plant and equipment after announcing the sale of both its Port Melbourne engine plant site and the Elizabeth factory site.

 

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Barry Park
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