Another huge blow to the construction industry as a major brickyard closes the state’s last factory
- Austral ‘mothballed’ last WA brickworks
- It couldn’t sell what the Cardup factory produced
- Construction sector in trouble, but expected to recover
The construction industry has once again suffered the closure of a key factory by Australia’s largest brick maker, citing poor sales.
Masonry giant Brickworks confirmed in a statement Thursday that it would mothball its Cardup factory, the company’s last factory in Western Australia.
Brickworks said its WA arm, Austral, has reported losses in recent years with falling sales due to a “slowdown in construction activity.”
It is the latest blow to the controversial construction industry that has seen dozens of companies fail in the past year.
The Cardup factory has closed before, in 2012 and in 2019, but is expected to reopen in 2020 after an upgrade.
The construction industry has again suffered the closure of a key factory by Australia’s largest brick manufacturer, citing poor sales
Masonry giant Brickworks confirmed in a statement Thursday that it would mothball its last WA plant, Cardup, and focus on selling excess stock
In 2016, Brickworks general manager Lindsay Partridge said the factory upgrade would mean 40 million bricks could be produced.
But Austral now has excess stock that the company will try to sell.
“After careful consideration, we have decided to mothball our Cardup plant to focus on selling excess inventory,” Brickworks’ latest statement said.
“To reflect the scaled back of operations in WA, we have made the difficult decision to eliminate a number of features.
“Unfortunately, this move is considered necessary at this time to help contain the ongoing losses in this market.
Sales volume in WA was sharply lower due to the slowdown in construction activity and the loss of key customer accounts following an attempt to increase margins.”
Brickworks thanked ‘all employees involved’.
Data from the Australian Bureau of Statistics showed that building permits in WA continue to climb downwards as the state’s housing crisis worsens.
The statistics show that only 897 homes were approved in February, up from 932 in January – a decrease of 3.8 percent. In February 2022, 1201 homes have been approved.
Last week, Melbourne-based construction firm Mahercorp told its clients it will go into voluntary receivership but that it “has not collapsed.”
Mahercorp is the latest in a string of construction companies to file for bankruptcy over the past year as the construction industry grapples with difficult conditions.
Austral’s Cardup factory was upgraded to produce 40 million bricks, but a construction delay prevented enough stock from being sold
Some of the biggest names in Australian construction have become insolvent over the past year, including Probuild, Home Innovation Builders, Privium, Condev Construction and Pivotal Homes
Businesses are still reeling from the effects of the Covid pandemic and the lack of wood and other materials due to the conflict between Russia and Ukraine.
Across Australia, bankrupt companies owe hundreds of millions of dollars to subcontractors, traders, customers and the tax authorities.
Some of the biggest names in the Australian construction industry have gone bankrupt in the past year, including Probuild, Home Innovation Builders, Privium, Condev Construction and Pivotal Homes.
The construction company’s failures came as a new market research report predicted the industry would recover.
ResearchAndMarkets.com predicted that the value of construction work in Australia would grow by 6.4 percent to $172,387 million by 2023 and maintain an annual growth rate of 5.5 percent through 2027.
By 2027, the construction value in Australia is projected to grow to $213,888.4 million.