Here’s an early test of the Rudd Government’s trade credentials, even before Senator Kim Carr, the minister for protection, has got his hands on a new industry policy: the NZ owned Fisher and Paykel appliances is closing its Brisbane whitegoods plant and moving it to Thailand to save money.
The Brisbane plant is based at Cleveland and more than 300 jobs will go over the next year. It’s in the federal seat of Bowman, which is held by the Liberal Party.
Fisher and Paykel is doing the same thing in New Zealand to a whitegoods plant in Dunedin which is heading for Mexico, and one in California will close and go to Mexico. There will be around 1070 jobs disappearing and the company hopes to save around $50 million or more a year: that’s after it spends $50 million buying and converting a Whirlpool plant at Reynosa, Mexico to aid its sales in North America.
All up the $100 million dollar cost of the new plant purchase and relocations will be met from property sales.
The shutdowns will happen over the next 18 months and the reasons given are the rising value of the Australian and NZ dollars and the rising cost of materials. It’s looking to combat these higher costs by lowering the cost of labour, which it will do by relocating to Thailand and Mexico.
Naturally the Australian Manufacturing Workers Union is now trying to convince the company not to close the Brisbane plant.
AMWU Queensland secretary Andrew Dettmer said the union believed the company was strong and could keep its Brisbane plant open. But given the strength of demand for skilled labour from the Queensland mining industry, the employees won’t have too much trouble getting new work.
But it is an early test of Rudd and his approach to industry policy and free trade.