Australian Rugby has confirmed that Wallabies defense coach Matt Taylor has stepped down following the Wallabies record defeat to Argentina in Round 2 of the Rugby Championship.

Taylor, who first joined the setup in 2020, had a meeting with head coach Dave Rennie, and both men agreed the time was right for Taylor to step down.

Speaking to the media, Rennie thanked Taylor for his contributions to the Wallabies over the past two seasons. 

"Matt is a great man with a strong work ethic, who is well-respected within the Wallabies environment, and we will miss him," Rennie said.

Taylor followed up with a statement of his own.

"While this was an extremely difficult decision, I know it's the right one for me and my family at this point in time," Taylor said. "I'm looking forward to spending more time with them and look forward to getting back into coaching when the time is right."

Cutting his teeth with the Queensland Reds, Taylor played a crucial role in their 2011 Super Rugby title victory. 

Since then, he has gone on to coach with both Scotland and Australia, amassing an impressive 110 coach caps along the way.

In the playing group, Reds star James O'Connor has been axed from the squad following the Los Pumas defeated.

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In his place comes former Waratahs playmaker, Bernard Foley, who many felt had played his last game for the Wallabies.

Speaking about O'Connor, Rennie said that he was "pretty devastated" at being dropped from the squad. Rennie then highlighted that he did not feel that O'Connor had shown enough to prove he could implement the desired game plan.

"James got a crack in the last test, we thought his experience would be very important, and we wanted him to drive the ship and allow us to implement our plan, and we were pretty clunky, to be honest, [and] lacked cohesion, and so he's missed out on selection.

"He's worked to get himself in really good shape. The issue from the weekend wasn't physical. He needs to convince us that he can implement the plan that we want, and it's difficult to do when you're not in the squad."

Rennie continued.

"He's pretty devastated. He's desperate to be a Wallaby. He's going to ensure that he keeps himself in good nick - as we know, based on injuries this year, opportunity could be around the corner. We'll get together with him prior to the squad assembling, just to sit down and go through his game, give him clarity around the shifts we need to see if he gets an opportunity with us."

Joining Foley in flyhalf role for the upcoming tests will be Brumbies youngster Noah Lolesio, who has shown flashes of brilliance when given the opportunity.

At 22 years old, Lolesio could well be the long-term answer for the Wallabies as they head to next year's World Cup.

Of course, there is Quade Cooper, who is side-lined with a long-term injury he sustained against Los Pumas in Round 1. 

Cooper will be looking to push to be fit and ready for next season, but even if he does return, flyhalf is a real area of concern for the Wallabies.

Finally, Rennie touched on the topic of regular skipper Michael Hooper, who is taking an indefinite leave from the squad to focus on his mental health.

The head coach confirmed he is in constant communication with Hooper but could not offer a definitive return date at the moment.

Written by Philip Bendon