Page 2 of 2 FirstFirst 12
Results 11 to 12 of 12

Thread: Australian dollar to plummet?

  1. #11
    Join Date
    Jun 2011
    Location
    Sydney NSW
    Posts
    1,144
    Users Country Flag

    Quote Originally Posted by Njay View Post
    i think its great if manufacturing picks up, i'm recently graduated chemical engineer and hoping it will open up some more job opportunities
    Sadly, what is considered manufacturing in Australia is having a company where everything is done in China. We had the opportunity to set ourselves up with out high dollar, only we wanted it to come down in value. As they say, "Be careful what you wish for. It might just come true". Our wish was for a dollar lower in value.
    --


  2. #12
    Join Date
    Jun 2011
    Location
    Sydney NSW
    Posts
    1,144
    Users Country Flag

    Quote Originally Posted by brad View Post
    I'm not sure how you work that out. High dollar makes imports cheaper. Given the ease & speed of transferring information between countries it is cheaper to get stuff fabricated overseas than make it here.
    It also makes it cheaper to buy machine tools to manufacture. Remember, with automated manufacturing, it does not matter where you manufacture as the labour cost ends up being just a small part of it.

    Quote Originally Posted by brad View Post
    A stair / railing / balustrade business I used to sub-contract for in 2007 had ~60 employees plus contract workers plus an Australian manufacturing / fabrication facility. A few years back he got rid of the tradies/fabricators/machinery & factory, bought a warehouse/office & retained his sales team, check-measurers, draughtsmen, installers & warehouse personnel. He sends all the drawings overseas & gets it fabbed over there.

    Sure a low dollar will bump up the capital spend but that's long term investment & not operating cost
    Work was being sent over to China long before the dollar went up in value. I did the manufacturing drawings for a company making crusher wear liners (some 400 over 10 years). They had to look elsewhere because there were not the foundries to cast in sufficient batch sizes. Foundries were not getting work here because of a refusal to update equipment. As a result work went to China. The few smaller foundries closed.

    I prepared manufacturing drawings for truck brake drums. The company here could not get workshops to turn the work out quickly enough. Most do not realise how frequently truck brake drums need replacing. He went to China because no workshop was capable of capable of producing them in sufficient quantities because of antiquated manual machine tools.

    Companies here simply did not see the value in updating equipment. Even now, little of the major engineering drafting gets done locally. I was asked to prepare fabrication detail drawings for a large portal frame building involving a lattice portal beam (140 tonnes). The price was right, the overall manhours was right, only they wanted it done in weeks not months, and the only place to get the required numbers was in China. Even if all those doing the work in Sydney banded together, it would still have taken too long.

    People leave the industry and it makes things that little more difficult.

    It needs some incentive to kick start it, only the price coming in from China is way under what anyone here can match. In drafting, it costs around $8,000 for a single AutoCAD seat with specialist packages costing from $20,000 per seat plus an annual subscription. China does not understand software licences and this is why they can offer the rates they do. We are being asked to match rates of between $3 to $10 per hour. At those rates, see how long it takes you to pay for the purchase of an initial licence and then how long it takes to pay for the annual fee. Then look at the cost such as utilities, telephone, Internet, etc, then wages, hardware and other software, and maybe a tiny profit and see how far those rates go. These rates had little to do with the exchange rate. We paid $8,000 per licence for AutoCAD when our dollar was USD0.60, and we are paid exactly the same price when it was USD1.05. All this despite the US price being USD $3,000 per licence.

    But we are digressing now.
    --


Page 2 of 2 FirstFirst 12

Bookmarks

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •  
| |