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Australian car industry needs increased government support
Car industry needs increased government support to
arrest decline
Attempts by Minister Kim Carr to revive
the Australian car industry will only help if the government
intends to continue to support the car industry's operations
and if the car firms can be convinced this is the case, says
Dr John Mikler from the University of
Sydney.
“Otherwise, the long-term scenario for the
industry in Australia is a further winding down of
operations to focus more on imported products and the
assembly of vehicles designed with a global market in
mind.”
Kim Carr, Minister for Manufacturing and
Defence Materiel, is holding meetings with top car industry
executives in Detroit to address the current crisis.
Dr Mikler is from the University’s Department of
Government and International Relations and has undertaken
extensive research on the international car industry.
“Although we like to think that we have an
Australian car industry, and fear losing it, the reality is
that we have an American and Japanese car industry with
operations located in Australia. This is why the Minister
needs to go to America to rescue 'our' industry.
“One of the major problems with the industry is
that it is hard for the companies to sustain a product
development and manufacturing presence in Australia without
the government providing an environment and support
conducive to this.
“Another problem is that in
global terms, we are a small market for which the
development and manufacture of unique products looks
increasingly unsustainable.”
“Since the John
Button car plan of the 1980s, Australian governments have
wound back their support for the car industry in
Australia,” Dr Mikler observed.
“Subsidies and
other forms of protection have been wound back over time,
and industry policy in general, with the strategic
intervention and planning this entails, is regarded less
favourably than it once was.
“Yet the reality is
that without government support it is more cost effective
for the firms to develop global products that are
manufactured in cheaper countries, and import them to
Australia,” Dr Mikler said.
Dr Mikler is the
author of Greening the Car Industry: Varieties of Capitalism
and Climate Change (2009).
ends
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