Build Or Bust? - Car Making In Australia & It's Uncertain Future

[JoeT]

Build Or Bust? - Car Making In Australia

John Carey
8 July 2008
www.wheelsmag.com.au

The future of car making in this country currently hangs in the balance. Question is, how badly do we want to retain it?

Bearded and bearish in his dark, three-piece suit, Kim Carr, Minister for Innovation, Industry, Science and Research, leans forward and finger-taps the desk to add emphasis to his words: “It is an industry that I believe this country can’t afford to lose,” he says. The Senator from Victoria is talking about the Australian car making industry. And Carr undoubtedly is able to influence whether the nation’s three remaining manufacturers – Ford, Holden and Toyota – stay put or, like Mitsubishi in March, shut down their production lines.

It’s onto Kim Carr’s desk that a heavy document will drop with a dull thud in late July this year. Officially titled the Review of Australia’s Automotive Industry 2008, it’s more commonly called the Bracks Review. Former Premier of Victoria Steve Bracks, aided by a panel of four experts, is the man in charge of taking a long, hard look at the Australian car industry. Once his review is delivered, there will be a wait of several months while the Industry Minister and his Labor government colleagues in Canberra decide what should be changed. Carr expects that a white paper outlining the government’s fresh new package of automotive industry policies will be ready sometime before the end of the year.

While Carr doesn’t want to discuss the Bracks Review’s possible findings or speculate on the policies that might follow from it, he’s happy to explain exactly why he believes car manufacturing is so damned important. “This is a business that produces in excess of $27 billion per annum of economic activity,” he says. The car industry is a major contributor to Gross Domestic Product (especially in the car-factory states of Victoria and South Australia), its exports earn more than $5 billion a year (more than any of our agricultural products, and second only to minerals), the business is very good for Australia’s balance of payments, it’s a high spender on research and development, and it generates big-time tax revenue. And don’t forget, Carr continues, that the industry’s economic reach is huge. Car makers are important customers of other Australian industries, including glass, plastics, steel and electronics.

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Holden Automotive Base Should Stay

Tim Dornin
8 July 2008
www.drive.com.au

If Australia loses its automotive manufacturing industry it is unlikely to ever get it back, Holden chairman and managing director Mark Reuss says.

Speaking at the company's launch of its new locally made Sportwagon in Adelaide on Tuesday, Mr Reuss called on the federal government to ensure, through its ongoing review of the car industry, that Australia remained an attractive destination for investment and one which encouraged innovation.

"If the global playing field is level, we will do the rest," Mr Reuss said.

"Look around the world and you will see governments competing to establish an automotive manufacturing base in their countries.

"To those who don't have one, the benefits are obvious.

"To countries that already have an automotive manufacturing industry like Australia, the message is equally clear - if you lose it, you are unlikely to ever get it back.

"And what you lose could be a lot more significant than many commentators seem to understand."

Mr Reuss said it was not just the jobs of those car company workers who assembled the final product that could go, but also the thousands of highly skilled engineers, designers and specialist suppliers as well as billions of dollars in related investment.

"Holden alone spent $420 million in research and development last year which has made it Australia's largest private sector R and D investor for a number of years now," he said.

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[omico]

It was never viable without government subsidy anyway. Manufacturing doesn't provide good jobs or major contributions to the local economy any more. TQM/SPC means that products of the same quality can be built anywhere, regional skills/management are not as important as they used to be. Factories themselves are a commodity now.

Holden has transitioned to an engineering company so they will probably survive. There are plenty of automative companies in Australia that make a good profitable living by importing and not bother to manufacture locally. Holden and Ford will be no different.

I think it is nativist romanticism that would want some form of manufacturing to remain. It really isn't that important certainly not enough to chuck government at.

omico

[mikmak]

It is funny you should say that omico. I believe almost the opposite. Whilst nativist romanticism gives light to the motivation of many folk who would, seemingly irrationally, oppose the demise of local manufacturing, it isn't the whole story.

I would think that when the design brief was drawn up for the Commodore, there would have been certain traits of previous generations, carried over to ensure some conceptual link to standing tribal precedence. These characteristics are what give Commodore and Falcon a little extra edge in the face of heavy social opposition and "moral encouragement" to downsize.

I made a thread not so long ago about driving through the regional areas that parallel the South East Queensland coastline. The general gist of it was that there is still a place where these traditional dinosaurs not only live, but thrive.

What's my point?

The qualities exhibited by the large RWD Aussie six are unique in the world. On a global scale they are a niche market. Their abilities are not highlighted by focus groups in capital cities or on line surveys and they are barely recognised by foreign markets because our conditions are also reasonably unique. Maintaining manufacturing locally (in concert with engineering) adds appropriate weight to the design brief, through the familiarity that the local engineer has with previous Commodores. Not the facts and figures, I'm talking about what it feels like to drive one.

In the future, local demands may head in a different direction and when it does, I want the replacement to be something that addresses our market demands. Those demands, and therefore the design brief, will not just be determined by computer modeling and calculations, but by memories, familiarity and, goddammit, just a pinch of Aussie enthusiasm. Without these things, the Commodore would already be dead.