The Australian automotive manufacturing industry has experienced substantial structural change (“Productivity Commission”, 2014). This has occurred in response to changing market and competitive conditions overseas and in Australia, and reductions in levels of assistance from governments (“Productivity Commission”, 2014). Following similar decisions by Holden and Ford, these factors led to Toyota's decision to abandon production in Australia by 2017. AMWU national vehicle secretary Dave Smith said "the decision would cost thousands of jobs, not only at Toyota but at all levels of supply." chain” (“Devastating day”, 2014) and represents the “collapse of the automotive industry in Australia” (Novak, 2014). The purpose of this report is to analyze and evaluate this decision of Toyota according to shareholder and stakeholder theories of corporate social responsibility and to identify the consequences of this decision along with the responsibilities taken by Toyota, the Australian Government and the Australian Manufacturing Workers Union for these consequences.TOYOTA SHAREHOLDERSThe high value of the dollar and substantially higher labor costs of automotive production in Australia compared to other countries such as China and Thailand have led to Toyota's inability to continue manufacturing in Australia. Toyota's decision to cease production in Australia will have consequences for numerous groups. However, according to shareholder theory, as advocated by Milton Friedman, a narrow focus on profit maximization is adopted, as Toyota's responsibility is to generate profits for its shareholders (within the limits of the law). The relentless pressure on vehicle manufacturers around the world to reduce production costs (“Pro...... middle of paper ...... in Australia, the automotive components sector will lose 30,000 workers (Wallace & Ferguson , 2014).Automotive component manufacturers that are heavily tilted towards Toyota will be significantly affected if they do not take immediate action. Government is expected to increase Automotive New Markets Initiative funding in response to Toyota's announcement that it will cease production in Australia. by 2017. This program provides “grants of up to $1 million for companies in the automotive supply chain” (“Productivity Commission,” 2014). These grants will encourage component manufacturers to diversify into other industries or markets export, if they continue to depend on Australian car manufacturing for their businesses they will be severely affected by the closure of Australian engine manufacturing and assembly plants (“Productivity Commission”, 2014).