Ford Shuts Engine Plant: V6 Duratec Engines For Falcon

Motoring Channel Staff - 23/July/2007

Geelong, Australia — The news is in - Ford Australia will close its Geelong engine plant and lay off some 600 workers by 2010. The ramifications of this closure will mean hundreds of Ford employees will have to look for new work, and that Ford's inline 6-cylinder engine will cease production after the year 2010.

The reason for the engine plant closure is based on the fact that the inline 6-cylinder engine which is manufactured at the Geelong plant, would not meet new emissions standards that will come into effect in 2010. It is cheaper to import a V6 engine than completely redesign the current I6.

Ford Australia also cites greater flexibility with the new V6, which will enable it to develop diesel engines and motors that can run alternative fuels. Send your thoughts on the engine plant closure and the switch to V6 to our Letters Page.

Combined with flagging domestic sales of large cars, the decision to decommission the engine plant by 2010 will mean that a Duratec V6 engine imported from America will power the Ford Falcon and Ford Territory in the next decade.

"The Australian car market has fundamentally and permanently changed," said Ford Australia President Mr Tom Gorman in Ford's official statement regarding the 2010 engine plant closure.

The Australia large car industry has been in a state of decline for some years now, and GM Holden has managed to secure the future of the Commodore by maximising exports to places such as the Middle East and North America. GM Holden's engine operations also export V6 engines to Europe and the Americas. Because few other countries demand a 4.0-litre inline 6-cylinder engine Ford's engine export possibilities were always limited.

"Our new engine strategy is a direct response to the lower manufacturing levels of locally produced large vehicles. Although we remain committed to our current local vehicle lines – Falcon, Falcon Ute and Territory – it is imperative that we improve our ability to respond to the increasing consumer desire for alternative fuels, improved performance, and better fuel economy while spreading the investment required across a broader base of vehicles. Importing the new engine from 2010 will allow us to achieve these goals," explained Mr Gorman.

Speculation has been rife that Ford Australia is also planning to export the new Falcon and Territory - or at least their underpinnings - to the USA and other large foreign markets to improve profitability. Ford Australia's president, Tom Gorman, hinted at such a move when he remarked: "We are currently investigating a number of alternatives that will allow us to return our Campbellfield manufacturing facility to 100 per cent capacity."

Clearly local sales are not likely to do this, and exports would appear to be the most likely scenario to boost manufacturing of the Falcon back to full capacity.

The Ford Australia announcement also gave the strongest indication yet that the Falcon and Territory will get diesel engines. It stated that "...improved economies of scale resulting from the globally-sourced [V6] engine will offer increased flexibility to potentially incorporate future alternative fuel strategies, particularly diesel technology."

Ford pointed out that the closing of the Geelong engine plant by 2010 and the retrenching of 600 workers won't impact on its other operations: "The company's remaining 1400 employees in Geelong and 3000 in Campbellfield will not be directly impacted by the decision."

According to Ford, "...the decision to introduce the new engine and discontinue engine operations at Geelong follows industry-wide changes in consumer behaviour, including lower demand for large cars and the corresponding increase in popularity of smaller, imported vehicles. These changes have seen sales of locally produced vehicles as a percentage of the total industry in Australia fall from 36.1 per cent in 1998 to 19.4 per cent year-to-date in 2007 (Source: VFACTS)."

According to reports from the Geelong engine plant, workers are shattered. AAP quoted the Australian Manufacturing Workers' Union (AMWU) vehicle division federal secretary, Ian Jones, who said workers felt abandoned.

"They feel abandoned and they feel angry," Mr Jones said of the retrenched engine plant workers, adding that the closure of the plant was a disaster for families in Geelong.

The Federal Government's Industry Minister, Ian Macfarlane, said that he had known for about a month and a half that closure of the plant was likely, stating that he had official confirmation a few days ago.

"In response to that [plant closure], the Commonwealth and Victorian governments are today announcing an innovation and investment fund to cover the Geelong area,'' Mr Macfarlane told reporters.

This would consist of $24 million which will be allocated to help the 600 Ford workers - and other unemployed people in the Geelong area - find new jobs.

The Victorian Premier, Steve Bracks, said that despite the announcement of the plant closure at the end of the decade, Ford's future in Victoria was not at risk. "The Ford operations in this state, in Victoria, are secure and safe for the future,'' said Mr Bracks.

"Already they're investing some $1.8 billion into the long-term production capacity of Ford, including a new research and development centre, including a next-generation Falcon, including commitments ongoing.

"As well as that Ford have agreed with the commonwealth to establish a $3 million community fund and that is to assist those people that will now face a very difficult situation as the plant is wound down in 2010 and Ford moves its next model Falcon to a V6 engine," Mr Bracks explained.

Related articles:
- Holden Commodore vs Ford Falcon (Road Test)
- Ford Territory Turbo (Road Test)
- Next-Gen Ford Falcon in Detroit (2008)
- Ford Falcon BF MkII (2006)
- Ford Focus Diesel (Quick Drive)