ELECTROLUX’S decision to close its plant by 2016 was met with anger and disappointment from government and union representatives when they learnt no amount of financial assistance could have saved Australia’s last remaining refrigeration factory.
Member for Calare John Cobb said he felt like everyone had “been had” by Electrolux’s head office, which shunned the federal government’s genuine request for more time to consider the plant’s business case for a $41 million bailout.
“It’s pretty obvious the global bosses decided they would shut it some time ago,” he said.
“It makes no difference what we, or the state government, committed. In fact I don’t think [Electrolux] wanted us to do it because it makes it more embarrassing to get that offer and still go.”
At 2.30pm on Friday, Electrolux managing director Australia and New Zealand Dr John Brown told the plant’s 544 workers they would be made redundant when the plant scaled down from late 2015 and closed within nine to 12 months.
The research and design centre, with its 44 workers, will continue for up to two years after.
Dr Brown said Electrolux had been working and cooperating with state and federal governments since the investment study was announced in February, but the board’s decision was driven by the plant’s inability to ever produce one million units a year and the differences in operating costs compared to its Thailand competitor.
“The company takes decisions about factory closures very seriously. They are very expensive decisions and very difficult decisions to make,” he said.
Orange mayor John Davis said the council had done all they could to save the plant, but the closure had been coming for 20 years.
“It’s a fair thing to say it was inevitable, but they doesn’t make it any easier,” he said.
“We’re lucky mining is still strong and will continue to be strong, and our medical precinct has been a godsend. All our eggs are not in one basket,” he said.
But Dr Brown said the decision was not inevitable and all options were looked at to avoid the “expensive” factory closure, but shareholders’ money had to be considered.
“It’s not a factory that is a basket case, its a productive, innovative factory,” he said.
Dr Brown said a tenfold difference in wages between Australia and Thailand was a factor.
Cr Davis said all politicians in the country agreed something had to be done to fix the disastrous state of the manufacturing industry, but no one was doing anything about it.
Mr Cobb said the state and federal governments were doing all they could to make Australia a more competitive place for business.
He rejected suggestions a federal bailout would have been a band-aid solution, saying the Electrolux plant remained profitable compared to other manufacturing companies.
Workers at the plant will have the opportunity to apply to work at the cooking products plant in Adelaide and all workplace agreements will and obligations will be honoured.
The future of the site beyond 2016 is yet to decided.