tThis literature is aimed at reviewing the management of changes implemented by Toyota Australia in response to the present economic struggle experienced in the automotive industry. Conflict had begun to brew in September 2011 as the manufacturing team at the Toyota Altona manufacturing plant in Melbourne pressed for a pay increment. The Altona team was represented by the Australian Manufacturing Workers’ Union (AMWU) in a negotiation for an increase of twelve percent over the duration of three years (Beissmann 2011a). This industrial action resulted in stop-work strikes that impacted Toyota Australia’s customers, dealers, suppliers and even employees whom did not participate in the industrial action (Beissmann 2011b). Resolution was finally reached between Toyota Australia and the union after six week of numerous intensive meetings. The agreement is that Toyota Australia will offer its employees an increase of eleven percent over a period of three years. This agreement came with the cost of loss productivity which prevented the scheduled launch date for one of its primary model, the new 2012 Toyota Camry (Beissmann 2011c). This literature brings forth an important point that the rationale basis of Toyota Australia to defend their position with the union over a difference of one percent increase is in question. In early January 2012, Toyota Australia publicized on their website of their strong sales performance despite having to overcome the challenges of production disruption due to the natural disasters in Japan and Thailand. Toyota was recognized as the Australia’s most popular automotive brand (toyota.com.au. 2012a). Therefore it was unexpected following this exciting news, that Toyota Australia President and CEO, Max Yasuda, announced the execution of downsizing its labour capital by mandating 350 redundancies. Mr Yasuda justified this action as absolutely essential to remain sustainable. Toyota Australia has been compromised by the grim market conditions which consisted of a reduction in export sales due to the current strength of the Australian currency (toyota.com.au 2012b). While minister, Kim Carr, resounded optimism that the Australia automotive industry is sufficiently resilient to withstand this tough condition, Mr Yasuda does not share the same tune. In fact, Mr Yasuda has proclaimed at present, Toyota Australia has only managed to construct a five year business plan (Beissmann 2012c).
In reference to the information provided by Toyota Australia suggests that the change implemented was driven from the external environment comprising of economic downturns and decrease of competitive advantage (Neo et al. 2011). The present interpretation is that Toyota Australia has adopted the political perspective of change when the decision was made to force as opposed to voluntary redundancy offered by Ford Australia (Spinks 2012). According to Graetz et al. (2011), the key features of this perspective revolves around acquiring organizational change via aggressive tactics that produces conflict that included bargaining. This directly reflects the continuous length of industrial conflicts that Toyota Australia has encountered from employees challenge for pay increment to forced redundancy (Drill 2012). It would appear that Toyota has neglected to approach this change decision from a psychological perspective to consider the damaging effects it would have on “survivors” from the redundancy movement (Graetz et al. 2011). The downsizing strategy implemented by Toyota Australia invokes what is term “survivor guilt”, which indicates a psychological reaction experienced by employees who survived and were able to retain their positions. However the impact can provoke anxiety over the stability of their jobs consequently decrease loyalty and staff morale. This anxiety is further exacerbated by the perception that good work ethics such as dedication and competency failed to save the jobs of their colleagues. Therefore, it is proposed