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Car Industry Support: Who's Right?

It’s red face time at Holden, Toyota and Ford as it’s been revealed a secret report commissioned by Australia’s three remaining local car makers, intended to back their calls for extra funding, is contradicted by a report compiled by a company formed as a merger between the original company used and another. Allen Consulting Group was asked to look into how the automotive industry impacts here in Australia and found that a loss of $23 billion would hit the economy between 2018 and 2031 if all three closed shop, stating the loss would be far higher than the amount of funding supplied. Unfortunately for the companies, Allen Consulting merged with ACIL Tasman to form Allen ACIL and a report issued by them says that taxpayer backed funding should be withdrawn. It was stated that the support is effectively a tax on the rest of the economy whilst the more successful industries prop up the less successful.

Initially released in April of this year, the three car makers have had to commission a revised report, after benching the initial one at a cost of around $100, 000 dollars, with the findings now expected for later this year. So it begs the question; who is right? Are our car makers truly in need of continuing funding in such a competitive market (it’s said there’s over sixty manufacturers available in Australia) or would it be better to cut the losses and have them as mainly import only?


  1. Desmond Kennard says:

    I only support funding by the Federal Government during what I regard as the nursery stage, that is the first 5-10 years after an industry has been established. However, I believe that every State Government and the Federal Government should be required to support the automotive industry by buying their vehicles from the the local car makers, even though some parts of the products may be imported. It is the labour content that is important.
    I accept that the Federal Government may make grants for research into such topics such as the introduction of collision avoidance technology into motor vehicles.

    August 29th, 2013 at 9:39 am