Australia’s biggest homebuilder, Metricon, has been forced to deny reports it is in financial difficulty after its founder died unexpectedly just days ago.
- Metricon employs 2,500 people and is currently building around 4,000 homes
- The company has been hit by rising costs, but strongly denies it is on the verge of collapse
- Metricon met with Victorian government officials this morning
Metricon chief executive and founder Mario Biasin died Monday, and chief executive Peter Langfelder has been named interim chief executive.
Metricon has been hit by rising construction costs, supply constraints and soaring subcontracting fees, but the company has strongly denied that it is on the verge of collapse and said it had no solvency problems.
Metricon executives met with Victorian government officials this morning.
The government is one of Metricon’s biggest customers.
Treasurer Tim Pallas said the company has told its government “all of its trade creditors have been paid in full and on time and Metricon expects that to continue.”
“We understand the pressure on East Coast builders due to rising costs, and the impacts this is having on the construction industry and residential customers,” he said.
“The government will continue to work constructively with industry to help address these challenges.
“Metricon is one of many partners in our Big Housing Build delivering high-quality social and affordable housing across the state, and this unprecedented program of work is well on its way.”
Mr Pallas said the company had informed the government that it was “working constructively with its lender”.
He also acknowledged the death of Mr. Biasin.
“I was shocked and saddened to learn of the passing of Mario Biasin,” said Mr Pallas.
“On behalf of the government, I offer my condolences to his family and colleagues at Metricon and acknowledge his significant contribution to the construction industry and to the state.”
Global sourcing issues, skills shortages affecting industry
Michaela Lihou of Master Builders Victoria said her organization was optimistic about Metricon’s future, but the industry as a whole was facing problems.
“The reality of the situation that the whole industry is experiencing right now is that there are supply shortages, skill shortages, price increases,” she told ABC News. Breakfast.
Metricon employs approximately 2,500 people and has approximately 4,000 homes under construction.
Federal Labor met with representatives from the construction industry this morning to discuss the issues facing Metricon.
“What’s getting worse, what’s really biting for companies like Metricon and others right now, is the area of skills shortages,” said Shadow Housing Minister Jason Clare.
“Whether it’s on-site skilled workers or laborers, that’s something that worries everyone I talk to in this industry.”
The construction sector was hit by bankruptcies due to rising costs related to global supply constraints.
Iconic cabinet Grocon collapsed in 2020 and this year ProBuild mega-builder — with its $5 billion work pipeline — fell.
Since then, ABD Group, Privium Home, Condev and, more recently, Next have gone bankrupt.
Equifax data suggests that while the overall insolvency rate in March 2022 was up 5% from a year ago, insolvencies in the construction sector were 28% higher.
In the first quarter of the year, compared to the same period in 2021, 270 construction companies filed for insolvency, a jump of 21%.
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