* Ford and GM unit to underwrite Autodom debt
* Deal avoids production shutdown by GM, Ford, others
* Australian auto industry struggling to retain workers
By Rob Taylor
CANBERRA, Nov 6 Top Australian auto parts
supplier Autodom Ltd was thrown a lifeline on Tuesday
when local units of Ford Motor Co and General Motors Co
agreed to underwrite the company's $6.5 million debt to
avoid a crippling vehicle production shutdown.
Autodom, a supplier of parts to local units of Ford, Toyota
Motor Co and the General Motors Holden unit of GM, last
week closed its plants in two Australian cities.
The closings raised fears the shutdown would halt Ford and GM
Holden production as soon as this week.
The deal, under which Ford Australia and GM Holden will
roughly share the strategically-vital company's debt liability,
was finalised with the appointment of receivers McGrathNicol Pty
Ltd, allowing Autodom to resume production as soon as Wednesday.
"Holden's involvement in the process recognises the
importance of the domestic supply chain to the automotive sector
and the multiplier effect on employment that an Australian auto
industry has on the broader economy," GM Holden said in a
Australia's automotive industry, based mainly in southern
Victoria and South Australia states, is a major contributor to
Australia's manufacturing base with three manufacturers
exporting $3.3 billion worth of vehicles a year with the aid of
around 160 component makers.
Despite hefty government subsidies and tariff support worth
around A$2.5 billion ($2.60 billion) a year, the industry has
struggled to maintain manufacturing jobs, with the Australian
arm of Japan's Mitsubishi Motors Corp closing its car
plants in 2008.
Coinciding with Autodom's woes, GM Holden said last week it
was cutting 170 jobs at its Adelaide assembly plant because of
falling demand for locally-built vehicles.
Tuesday's deal allowed receivers to be appointed for
Autodom, which employs around 400 staff, and paves the way for
the company to be restructured.
Under the deal neither Ford nor GM Holden are to become
owners of Autodom, Australia's largest press metal manufacturer
and supplier of complex metal and plastic components to
carmakers, company sources told Reuters.
Ford, which buys hundreds of components from Autodom for its
locally-built "Falcon" sedan and "Territory" SUV vehicles, had
before the deal was announced been expected to be most affected
by the shutdown.
Ford workers were on holiday on Tuesday, but Holden said
disruptions to production of large "Commodore" sedans and
smaller "Cruze" vehicles would now be minor and the company
might only be forced to retrofit some components.