ACT Ford dealer John McGrath was surprised by the company's three year time-lag before exiting manufacturing in Australia.

ACT Ford dealer John McGrath was surprised by the company's three year time-lag before exiting manufacturing in Australia. Photo: Mal Fairclough

A Canberra Ford dealer says he is bewildered by the company's three-year time lag before it stops making cars in Australia.

Ford announced on Thursday that about 1200 workers will lose their jobs at two plants in Victoria by October 2016.

ACT dealer John McGrath said he was disappointed but not surprised, except for the timing. ''The 3½ years, I am bewildered,'' he said.

''Why give 3½ years notice? I don't understand that - I wouldn't mind an answer to that one myself.''

He said a short-term repercussion usually followed such announcements, but then everyone forgot about it. Mitsubishi, for example, took about seven weeks.

Mr McGrath said the Ford products that were selling well in Australia were imported, and the decision would not affect his dealership.

''Your Focus, Fiesta and Ranger, that's the product selling at the moment. The Falcon isn't selling. We're (selling) a quarter of what we were doing 10 years ago.

''As long as it doesn't affect branding of Ford, I don't see a problem because if it affects the branding it may make people make a decision on buying a Focus or not. That to me is more critical than losing the Falcon.''

The McGrath dealership employs more than 200 people, including 34 apprentices, and he expects the business to continue to be labour intensive well beyond 2016.

Mr McGrath said by then Ford would be more profitable and would be in a position to release more models. ''As a company they will be a lot stronger in Australia.''

He said although massive job losses had been forecast in the parts manufacturing business as well, these days most parts came from overseas.

The numbers of Falcons being sold now were fewer than models of Mitsubishi made in Australia when that car maker decided to stop production here.

Ford had long ago switched to a global target with its various models.

''The Focus is a worldwide car; it was only two or three weeks ago that the Focus was the number one selling car in the world,'' he said.

''The concept of an Australian-only car, the market just isn't big enough.

''There's over 60 manufacturers supplying cars into Australia.''

Mr McGrath said Australia had more choice of car models than any other country in the world.

''The Button car plan [named for former industry and commerce minister John Button] back in the 1980s was the start of the decline of manufacturing in Australia. The tariffs were replaced by government subsidy.

''Where everyone thought they were getting cheaper motor cars, the taxpayer was actually paying more because the government had to subsidise the industry to keep them going.

''All this about the Button car plan being a great thing - 'we're not paying so much for cars any more - it was just madness. Taxpayers were subsiding General Motors, Toyota and Ford for manufacturing in Australia.''