The Australian car industry has taken another hit with embattled Victorian parts supplier CMI Industrial forced to close two plants, leaving 119 workers jobless.
After entering administration in April, CMI Industrial's receivers, McGrathNicol, last night confirmed two of the company's plants had not attracted viable offers during the sale process and would be shut down before the end of the year.
McGrathNicol confirmed CMI’s Campbellfield and West Footscray plants would continue to supply key customers until wind-down plans are initiated from the end of October. In total, 67 employees at Campbellfield and 52 at West Footscray will be made redundant at the end of the wind-down process.
Ford Australia accounts for roughly one-third of CMI’s customer base, sourcing suspension components, airbags and seatbelts from the supplier to produce its Falcon and Territory vehicles. CMI also makes components for Holden and Toyota, as well as customers in the transportation and whitegoods industries, among others.
Ford Australia’s Neil McDonald said with the wind-down still at least three months away, the local car maker was not expecting it to have any impact on vehicle production.
“We’re not anticipating any disruption to production and we’re currently in the process of ensuring an orderly transition of supply at this point,” McDonald said.
McDonald said he was not in a position to comment on whether Ford was looking offshore to source the components once CMI ceases production or if it was aiming to purchase the parts from a different Australian supplier.
The announcement from CMI’s receivers comes little more than a week after Ford Australia confirmed it would axe 440 workers from its Victorian operations before the end of the year and cut vehicle production by 30 per cent, amid diminishing demand for its large Falcon family car.
Ford Australia was forced to stand down approximately 1800 workers at its Broadmeadows and Geelong manufacturing plants for a week in April following a lockout at CMI that sparked the initial administration action.
McGrathNicol will assist affected CMI employees to lodge claims in respect of their entitlements under the General Employee Entitlements and Redundancy Scheme (GEERS).
The receiver says there has been some interest in CMI’s Ballarat operations and will work with relevant stakeholders over the coming weeks to determine whether a sale can be completed to keep that plant open. CMI also operates plants in Horsham and Kensington.