Car crash...

In light of Ford's gutting decision to cease manufacturing vehicles in Australia from 2016 below is a wrap up of some of the discussion and implications.  Firstly some historical perspective.  Back in April, outspoken former Ford CEO Jac Nasser was blunt and on point with his predictions for the Australian car industry:

FORMER Ford president Jac Nasser says the demise of the struggling Australian carmaking industry appears inevitable in the face of a high dollar, high costs and excess overseas capacity.... 

...The BHP Billiton chairman's dire assessment of the nation's deteriorating car industry comes after Holden this week said it would axe 500 jobs in Adelaide and Melbourne as it cut production from 400 cars a day to 350 because of the strong dollar, which was last night trading at a seven-month high above $US1.05... 

...It was difficult to predict how long it would be before there was no car manufacturing in Australia, he said, stressing it depended on the strength of suppliers. 

"As soon as you have a reduction in the scale of domestic manufacturing - let's assume one of the three decide to exit Australia in terms of manufacturing - then you end up potentially with sub-scale supplier infrastructure," Mr Nasser said. "Once that happens, I think it's a domino effect. It would be a very sad day for Australia but unfortunately it looks like it could be inevitable."...(here)

Nasser has been a contraversial and outspoken figure caused a stir with his comments which a month later proved correct.

Ford’s exit spells the end of the road for manufacturing 

Gone are the days when Ford could build legendary sports sedans, like the Falcon GTHO Phase III. In 1971, it was the fastest four-door saloon in the world.... But Ford Territory sales couldn’t offset the disastrous plummet in Falcon sales, which has been the mainstay of Ford’s range since the 1960s. Corporate fleet and government sales, which account for two thirds of large, local car sales in Australia, are insufficient to meet the volumes required to keep products like Falcon profitable and viable....

...The loss of 1,200 jobs in Broadmeadows and Geelong is only the tip of the iceberg. Victoria, the manufacturing hub of the country, is in recession. The high Australian dollar is killing the manufacturing sector. Sectors of the farm industry are in huge trouble. Much of the world economy is in an extended state of recession and austerity....If the mining super-profits boom has plateaued or, worse, disappeared, as some pundits have predicted, then Australia is in for a long winter of discontent. 

Neither side of politics has any solution to these problems. Future Australian governments face a hollowed-out manufacturing sector, declining revenues from resources and an ageing farm population facing import competition as never before....Australia rode out the GFC on the back of virtually unprecedented mining boom and a fiscal revenue position that was Made in China. But that was a thin, glossy veneer on what was – and is – in reality a deficit-ridden, Dutch-diseased, debt-financed bubble.Shell is selling the Geelong refinery. BAE Systems is getting out of Australia. Ford will be gone in 2016....Who will be next? (here)

And on the specific point as to the vulnerability of parts manufacturers (with ominous US precedents such as Delphi in the US which was bought out by its customers, including General Motors), signs do not look good:

Component maker Autodom has shed up to 15 per cent of its workforce in Victoria and South Australia since carmakers Holden and Ford took control of the company in November.
Autodom and its subsidiaries are in liquidation but the group's assets are being operated by receivers McGrathNicol to ensure ongoing supply of components for the carmakers (here).

Back to the drawing board Ozzie governments...!