Mike Sinclair•24 May 2013
NEWS
October deadline emissions related
Euro 5 emissions draw line under Falcon and local Territory viabilityThe timing for the cessation of local production of Falcon and Territory as announced today by Ford Australia boss, Bob Graziano, is not related to model year turnovers, employment contracts or even the date of the 2016 Bathurst V8 Supercar enduro.
Rather, the October 2016 factory closure is inextricably linked to the adoption of Euro 5 emission standards Down Under. The regulations, which Ford’s existing locally produced vehicles would need expensive engine development to meet, come into force on November 1, 2016.
Ford’s current six-cylinder engines are certified to Euro 4 emissions levels, but the company made no secret that significant additional investment would be required to meet Euro 5. Whether this was to be via changes to the existing inline six-cylinder engine or the re-engineering of Falcon and Territory to use ‘global’ engines with existing Euro 5 credentials now seems to be a moot point.
Originally, it was proposed that Euro 5 would take effect in 2012 with Euro 6 to follow four years later. The federal government plan was then postponed at the urging of the local auto industry.
Now all new models launched after November this year (2013) must comply with Euro 5. Carry-over models like Falcon and Territory were exempted from meeting the new emission standards until the November 2016 date.
Of course, Euro 5 emissions alone did not sound the death knell for Ford’s locally manufactured models. Reduced volumes and high manufacturing costs made even heavily subsidised business models impossible to sustain, Ford sources said.
Almost forgotten in today’s factory closure announcement was Ford Australia’s news that it posted $141m loss in financial year 2012. The 2012 amount follows a $290m loss in 2011 and takes total loses over the last five years to over $550m.
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Written byMike Sinclair
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