Australian leather producer cries foul on South African subsidy
The Australian automotive leather producer, Howe Leather, has shed 65 jobs, around 10% of its workforce, after losing the Mitsubishi account to a South African producer. The development follows the loss of the General Motors account to the South African arm of Eagle Ottowa in August 2002 (For that story, use search facility leatherbiz.com news page).
Speaking to the regional media, Graeme Monkhouse, the CFO of Howe’s parent group Schaffer, revealed the Mitsubishi contract equated to around 5% or A$10 million ($6.61 million) of Howe’s annual turnover. As with the General Motors account, the South African producer had been able to undercut Howe on price because of the 30% South African government subsidy, Mr Monkhouse said.
Ironically, Howe was itself at the centre of of subsidy storm in the 1990s when the
