Toyota to close Sydney office

TOYOTA Australia today announced it will close its Sydney operation, finally plumping for Melbourne as its sole head office after decades of being split between Australia’s biggest cities.

The company will close its Caringbah sales and marketing office and offer to help relocate the 350 affected employees to the Melbourne head office in Port Melbourne.

The decision may have been influenced by Toyota Motor Corporation president and CEO Akio Toyoda, who visited Australia last month, and earlier this year shed a tear as he announced the end of local manufacturing.

Australia has played an important role in Toyota’s global history. It was Toyota’s first significant export destination and its first overseas production venture – significantly, at the existing Port Melbourne site. So it is hallowed ground for Toyota.

The consolidation in 2018 will finally end the historical tension between the two centres in Sydney and Melbourne, one a highly profitable commercial vehicle importer (that started as Theiss) and the other a larger but more problematic manufacturer and importer of cars (that started as AMI).

The rivalry, which was recognised back in Japan as a problem needing to be addressed, has eased in recent years, following the appointment of Dave Buttner, a former chief of manufacturing in Melbourne, initially as senior executive director of sales and marketing, traditionally a Sydney-based role.

He subsequently was appointed executive vice-president and, earlier this year, president of Toyota Australia.

Announcing the decision to consolidate in Melbourne, Buttner admitted that 2014 had been “an extremely tough year for everyone at Toyota Australia”.

“These changes will provide us with the best opportunity to have a strong and sustainable base for the next 50 years and beyond,” he said in a statement.

“The decision … supports our long-term vision and will assist us in improving business efficiency, increase collaboration and reduce operating costs.”

The 350 sales and marketing staff from Sydney will join almost 1000 people remaining in the Melbourne head office. Total workforce will fall from 3900 to 1300 when manufacturing ceases in 2018.

Mr Buttner said the company would retain the Altona production site and establish a Centre of Excellence there, comprising a world-class training facility and some other commercial initiatives that will “enhance the company’s business and the community”.

This is thought to be a reference to work the company’s production process engineers recently completed at St Vincent’s Hospital in Melbourne, where they redesigned the hospital’s medicine packaging operations for patients and cut the cycle time by more than 80 percent.