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Australia Offers State Aid to GM, Toyota, Suppliers
General Motors Co., Toyota Motor Corp. and suppliers that invest in their Australian operations will be eligible for aid from the country's new A$200 million ($178 million) state fund.
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General Motors Co., Toyota Motor Corp. and suppliers that invest in their Australian operations will be eligible for aid from the country's new A$200 million ($178 million) state fund.
Toyota says it plans to tap the fund for A$29 million ($26 million) in aid to defray some of the A$123 million ($109 million) it will spend on in its Australian facilities.
The country has periodically used state aid to coax carmakers to retain their local operations. Australia was hit hard by Ford's announcement in May that it would close its two assembly plants there in 2016. Government officials note that the country's auto production, which barely topped 200,000 units in 2012, is already at a 56-year low.
GM's Holden unit and Toyota have cut jobs in Australia over the past two years. Analysts say an 83% surge in the Australian dollar against the yen has shrunk export demand and made locally built vehicles more expensive than imports from Japan.
Sales of Australia-made vehicles which account for less than 10% of the domestic market dropped 21% to 62,800 units in the first seven months of this year, according to the country's Federal Chamber of Automotive Industries. The overall market grew 5% during that period.
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