Harley-Davidson casts aside local plant
The American company's Australian-based wheel plant will cease operating by 2013, as the company makes changes to its overall production strategyHarley-Davidson Inc. will close down its fully owned Australian wheel and hub-making subsidiary in South Australia by mid-2013, after which it will source components through existing suppliers.
Harley-Davidson purchased the Adelaide-based New Castalloy in 2006, but the company was a supplier to the American company long before that.
The decision to cease operations at New Castalloy will cost hundreds of local jobs – it currently has work force of 2012 -- while the savings for Harley-Davidson are expected to be about $9 million annually from 2014 – although the initial restructure will be a solid hit to the tune of about $30 million.
"The company's decision on wheel production follows a review of the long-term fit and competitiveness of the New Castalloy business with our strategy and was not made lightly," said Matt Levatich, President and Chief Operating Officer, Harley-Davidson Motor Company. "New Castalloy has been a valued part of the Harley-Davidson team. We appreciate the many significant contributions of New Castalloy's employees over the years."
Under Haley-Davidson’s new manufacturing strategy, the company will produce motorcycle fuel tanks, fenders and frames, paint, final assembly and powertrain production in-house, and all other parts will be outsourced.
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