Manufacturers to turn around market

Ford, Holden and Toyota have it within them to boost the market beyond the forecast 850,000 units. The three local manufacturers are the only companies distributing passenger vehicles in Australia with the wherewithal to micro-manage production and inventory.

Mazda MD Doug Dickson is backing a bold initiative to order stock beyond what is entirely prudent in anticipation of the market picking up again before the end of the year (more here).

In his view, the market cannot hope to better the forecast figure of 850,000 units for the year unless importers throw caution to the wind and order more stock in advance. Most importers are unlikely to be as gung-ho as Mazda in that regard.

The major agenda item underpinning the Mazda strategy is the hope that the company will not only expand its market share during the downturn, but will retain that market share once the economy improves again. It's a risky strategy, but as with any gamble, the returns could be huge.

The three local manufacturers are in the same situation for most of their respective product ranges, since these three are importers as well as manufacturers. But production of their locally manufactured cars (Ford Falcon, Territory, Holden Commodore, Statesman/Caprice, Toyota Camry and Aurion) can be adjusted to suit the prevailing demand.

Holden has done so without job losses, although not without some hip-pocket pain for its workers (more here). Ford has had to reduce production staff levels through voluntary redundancies (more here), but Ford and Holden are both looking forward to increasing production capacity again when new small-car models enter production and/or the market picks up.

Ford President Marin Burela says that the company's production capacity has been tailored to fit the market as it stands and leaves no fat to be trimmed in stock levels (more here). Burela mentioned the Territory in particular, but the company is also micro-managing Falcon production.

"To date, we have been very successful in doing that -- and I would like to think we'll continue to be successful," he said.

Although even the upbeat Burela isn't saying as much, the careful balance of supply and demand can be ramped up rapidly if the market changes for the better -- for once providing local manufacturers with an opportunity not available to the full-line importers.

Read the latest Carsales Network news and reviews on your mobile, iPhone or PDA at www.carsales.mobi