Rationalisation or decimation

[sptrawler]

Will Australian business survive without the public funding?
Holden, Ford now SPC are being weaned off Government sponsorship. It will be interesting to see if Coca Cola sells off or floats off the Shepperton factory.
I'm sure there will be buyers at the right price and willing workers also plenty of product.
Maybe this is the beginning of Australia meets the global market?

http://au.news.yahoo.com/thewest/business/a/21179190/coke-disappointed-by-govt-grant-refusal/

Or maybe Coca Cola will suck it up and spend their money to make the plant competitive.

 

[Knobby22]

Unfortunately we don't live on a even playing field and SPC Ardmona is the last fruit cannery left.
It is nearly certain the plant will be closed with the loss of thousands of jobs. The $25 mil saved will quickly go in unemployment benefits.

I know I am going to hate buying, jam (IXL), canned fruit etc. from subsidised factories in Italy and France.
As the Federal Liberal member from Mildura said. " Once it is gone, we will never get it back".

If it does get saved it will be due to the $A dropping a lot more.

 

[sptrawler]

Unfortunately we don't live on a even playing field and SPC Ardmona is the last fruit cannery left.
It is nearly certain the plant will be closed with the loss of thousands of jobs. The $25 mil saved will quickly go in unemployment benefits.

I know I am going to hate buying, jam (IXL), canned fruit etc. from subsidised factories in Italy and France.
As the Federal Liberal member from Mildura said. " Once it is gone, we will never get it back".

So therefore by your reasoning, they get $50m this year.
Then can't compete and want $150m in 2 years.
Still can't compete, you throw in another $1b.

When do you tell Coca Cola to either sell it, or fix it?

O.K lets say I own a company that makes widgets and sell them at $2 each and I employ 2000 workers in a high unemployment town. Then someone in the city opens up a factory making the same widgets for 50cents.
Does the government have a responsibility to keep the $2 widget factory running, because it employs 2000 people?

I know it's not a level playing field, but playing a game of who has the deepest pockets is dumb.

 

[Bill M]

I can't see why CCL doesn't put the $25 Million in addition to the $90 Million there were going to spend on it anyway. Why should the tax payer fund that business? CCL paid out a massive 26.5 cents per share dividend back in August 2013. How about scaling back the dividends and put it back into it's own subsidiaries? It's not like CCL is broke or anything.

 

[sptrawler]

I can't see why CCL doesn't put the $25 Million in addition to the $90 Million there were going to spend on it anyway. Why should the tax payer fund that business? CCL paid out a massive 26.5 cents per share dividend back in August 2013. How about scaling back the dividends and put it back into it's own subsidiaries? It's not like CCL is broke or anything.

Well Tanya Plibersek was saying Labor would throw more money at them.
Memo to self, buy CCL Labor underwrite my dividend.

 

[sptrawler]

Another option, why don't the Goulburn fruit growers form a co operative and take over the cannery.
CCL would give it to them, wouldn't they? it's losing money and they are going to close it.

 

[Knobby22]

So therefore by your reasoning, they get $50m this year.
Then can't compete and want $150m in 2 years.
Still can't compete, you throw in another $1b.

When do you tell Coca Cola to either sell it, or fix it?

O.K lets say I own a company that makes widgets and sell them at $2 each and I employ 2000 workers in a high unemployment town. Then someone in the city opens up a factory making the same widgets for 50cents.
Does the government have a responsibility to keep the $2 widget factory running, because it employs 2000 people?

I know it's not a level playing field, but playing a game of who has the deepest pockets is dumb.

We need anti dumping measures!!!! Like other countries!!!!
Please read this from a Liberal MP. And she is no intellectual slouch!

The Federal Member for the northern Victorian seat of Murray, Sharman Stone, says a belief that SPC Ardmona is at fault and should be left to its own devices to survive in a free market environment is a misunderstanding of the company's predicament.

Dr Stone says a range of factors, including the fluctuating Australian dollar, the delay in a decision on anti-dumping measures and the supermarket duopoly of Coles and Woolworths are behind the company's woes.

"Let's be realistic about how difficult it is in Australia for manufacturers to survive, and how we do need to have those factors taken into account when a company says we're going to go under if we don't meet a little government understanding in the short term," she said.

Dr Stone, who holds a PhD in economics and business, says members of the cabinet who are resisting the restructure package have not grasped how complex the company's problems are.

She says the impact of SPC Ardmona going out of business and the loss of 2,000 jobs in the region would be horrendous.

"We have a bigger impact in the Murray and Goulburn Valleys, or the northern Victorian economy, than you would have with the automotive industry in say Adelaide," Dr Stone added.

 

[Julia]

I know I am going to hate buying, jam (IXL), canned fruit etc. from subsidised factories in Italy and France.

Why? Simply because their European factories are subsidised?
As Bill says below, why shouldn't the parent company provide the necessary injection of funds out of their massive profits? Why is it up to the Australian taxpayer to subsidise any business?

If the taxpayer were to effectively further prop up CCL's profits by removing from them the necessity to fund properly one of their own companies where will it all end?
Why then would not every business in Australia which has failed to function profitably, for whatever reason, similarly be able to expect the government to support it?

I can't see why CCL doesn't put the $25 Million in addition to the $90 Million there were going to spend on it anyway. Why should the tax payer fund that business? CCL paid out a massive 26.5 cents per share dividend back in August 2013. How about scaling back the dividends and put it back into it's own subsidiaries? It's not like CCL is broke or anything.

Exactly.

The Federal Member for the northern Victorian seat of Murray, Sharman Stone, says a belief that SPC Ardmona is at fault and should be left to its own devices to survive in a free market environment is a misunderstanding of the company's predicament.

Dr Stone says a range of factors, including the fluctuating Australian dollar, the delay in a decision on anti-dumping measures and the supermarket duopoly of Coles and Woolworths are behind the company's woes.

"Let's be realistic about how difficult it is in Australia for manufacturers to survive, and how we do need to have those factors taken into account when a company says we're going to go under if we don't meet a little government understanding in the short term," she said.

Dr Stone, who holds a PhD in economics and business, says members of the cabinet who are resisting the restructure package have not grasped how complex the company's problems are.

She says the impact of SPC Ardmona going out of business and the loss of 2,000 jobs in the region would be horrendous.

"We have a bigger impact in the Murray and Goulburn Valleys, or the northern Victorian economy, than you would have with the automotive industry in say Adelaide," Dr Stone added.

Oh my! It doesn't occur to anyone that Sharman Stone might have her own job in mind?
If the taxpayer were to come to her party then she'd be considered a local hero, destined for re-election, but the government's decision today will probably see her as less than a life saver in the eyes of her electorate.
It is what it is.

 

[sptrawler]

We need anti dumping measures!!!! Like other countries!!!!
Please read this from a Liberal MP. And she is no intellectual slouch!

.

I agree completely, however lets not blame everything on dumping.
We are selling canned fruit, that costs a lot to can.
You can't blame dumping when their costs to can are a lot less. That's just a cheap shot.

It's a bit like saying our miners are dumping minerals, because ours are the cheapest in the world to extract.

 

[skc]

I can't see why CCL doesn't put the $25 Million in addition to the $90 Million there were going to spend on it anyway. Why should the tax payer fund that business? CCL paid out a massive 26.5 cents per share dividend back in August 2013. How about scaling back the dividends and put it back into it's own subsidiaries? It's not like CCL is broke or anything.

+$25m.

So any company should limit funding to all their subsidiaries any time they need any sort of investments and hold the government randsom.

What if Myer set up every single store as a subsidary, and asks the government for handouts anytime a store is unprofitable, or they will close the store.

For the record, CCL makes around $400-500m profit per year. What a joke.

 

[sptrawler]

+$25m.

So any company should limit funding to all their subsidiaries any time they need any sort of investments and hold the government randsom.

What if Myer set up every single store as a subsidary, and asks the government for handouts anytime a store is unprofitable, or they will close the store.

For the record, CCL makes around $400-500m profit per year. What a joke.

Absolutely I think Australia is at the knee point, it is make or break. Companies need to decide "Invest in Australia or F#ck off".
There is no long term survival being everyone's b1tch.
We have more arable land than any other continent, we have easiliy recoverable resources, we have brains. Yet we roll over and pizz on ourselves.
Tell them to invest or ffffff off.

 

[noco]

Once again we are seeing employers saddled with excessive claims and conditions from the unions...read the conditions in the link below.....well and truly over cooked IMHO.

Perhaps if SPC were to rid themselves of the unions and renegotiated a deal with employees, then jobs may be saved together with further assistance of the parent company CCL...It is a matter of restructuring to save the business without handouts from the tax payers.

You will never hear the unions say, when things are bad we will give you a leg up....oh no....blame the Governement of the day for not giving a hand out......they are more than happy to go on demanding outlandish claims.....Is it any wonder some companys are going off shore to keep afloat!!!!!!


http://blogs.news.com.au/heraldsun/...he_spc_ardmona_claim_even_make_it_to_cabinet/

 

[sptrawler]

It is really hard for a greed driven economy to adapt to a production driven economy.
Fortunately Australia has a huge amount of arrable land and a huge amount of easily extracted minerals.

A small population and an immense resource, it really is time to capitalise before the window slams shut.IMO

24m people can't prop up our welfare system and prop up multinational companies

 

[sydboy007]

Maybe we need to stop allowing countries that heavily subsidies their agricultural products such free access into Australia. Some traffics to at least level the playing field.

I'm all for free trade, but when our farmers and food processing industries are supposed to compete against countries that spend more on farm subsidies than we do on defence, expecting them to be able to survive against those unfair odds is a bit rich.

My understanding is there's already been a 30% workforce reduction at SPC to get productivity up and costs down.

- - - Updated - - -

It is really hard for a greed driven economy to adapt to a production driven economy.
Fortunately Australia has a huge amount of arrable land and a huge amount of easily extracted minerals.

A small population and an immense resource, it really is time to capitalise before the window slams shut.IMO

24m people can't prop up our welfare system and prop up multinational companies

Unless you believe we can turn desert into arable land, pretty much every report I've read says we can maybe grow enough food for 80-90 million people.

 

[Knobby22]

All good points.
Maybe I am wrong and we should just let it happen and accept it is cheaper to import canned fruit than make it here.
I feel sorry for all the farmers in particular, many of them have already ripped out their orchids.
Maybe in the future when the $A is low, the farmers can start again with another co-operative.

Syd. has a good point also. I'm over the farm subsidies but what can we do?

It is not a cost saving measure though. The cost of unemployment benefits will wipe out the money pretty quick and combining this with whatever the Nationals get for the farmers and the Libs do to invigorate the town, the overall effect will be more taxpayers money required and us not being able to buy Australian canned fruit and jam (IXL is also part of it).

 

[orr]

If I was in the position of treasury and finance I'd be including in a public statement, about now, how.... 'We're not. as a Government, thinking about introducing a tax on the processed sugar content of foods, and it shouldn't be suggested that we've ever entertained the thought. It's not as though we're under any budget pressure. The obesity and Diabetes rates of the Australian population are should be a cause for celebration, indicative of our success. The minor impost these 'success indicators' place on our health system are for us just like writing the cheque for any national fire works display. That sort of display is one of the many things that 'go better with coke.'...' ah... a tax on processed sugar, perish the thought'


Does Cory Bernardi enjoy 'Two Fruits' with a little cream and cherry on top.

 

[CanOz]

If Australia wants to remain a free market economy then there can be no bail outs of any of these Companies. Its a political statement and nothing more. Its a bad business decision. The market is still there for someone else to step in and have a go, OR it will go to imports until they're hit with tariffs.

SP I think SPC Ardmona WAS partially owned by the growers, well the Ardmona part at least. I interviewed with them a long while back before the merger. Perhaps thats when they bought out the growers.

I don't agree with any bailouts, they're political and warp the sense of a fair economy.

 

[sptrawler]

It was really interesting today, I was out with a long time mate, who works for the council.
We have differing political ideas, so tend to avoid politics.

Today he said, isn't it weird that the Liberals are telling big business, to get stuffed and Labor are saying they will throw money at them.
I just laughed. and thought to myself, when was the last time you saw a brickie or a sparkie or a plasterer as a Labor Party Member.

Lines of political demarcation become more vague as time goes by, what was a Labor driven agenda 50 years ago may not be today.

Also what was a political agenda of Liberals 50 years ago, may not be relevant today.
Nothing stays the same, nothing is forever and everything is a compromise.

It's not 'black and white' anymore.

 

[Baldric]

In the case of SPCA I think it is in Australia's interests that this plant be kept going. It may be cheaper to imprt caned goods from overseas but we have no QA on what goes into the can. Aust is fairly advanced in the use of agricultural chemicals and the safety periods etc, more so than some of the countries that would like to export their canned fruit to us.
I would prefer that instead of govt handouts CCA request protection against cheap imports or get the large retailers to buy a greater percentage of goods locally instead of them bringing in cheap imports.

 

[sptrawler]

I was wondering today, now that the Holden, Ford, SPC situation is high in ASF members minds.

How many of us, will make a special effort, to buy a Holden, Ford or an SPC product.

My guess is, not many, sadly.
Because if all Australians made a point of choosing the product, they wouldn't need you to bail them out.

Funny really, many say we should bail them out, but not many buy the product.lol