Government responds to Auto Senate report draws ire

Earlier this month after a two year wait, the Turnbull Government finally released its response to the Senate report into the Future of Australia’s Automotive Industry.

Earlier this month after a two year wait, the Turnbull Government finally released its response to the Senate report into the Future of Australia’s Automotive Industry, only a month before the closure of Holden and Toyota manufacturing facilities.

The wide-ranging response addressed the reports many recommendations, outlined the future of Ford, Holden and Toyota post-manufacturing operations in Australia and detailed initiatives designed to boost innovation and growth.

Notably, the Government’s response rejected many of the report’s recommendations, such as the need for an Automotive Industry Taskforce and extending the Automotive Transformation Scheme (ATS).

In the response, the Government supported the report’s recommendation to continue restrictions on parallel imports, whilst supporting fair and transparent franchising relationships between motor vehicle dealers and OEMs.

Future in value-add activities

The key response take-out noted the future of the manufacturing in Australia lies in value-adding activities such as research and development, design and production, to distribution and aftersales services as the future, with growth and innovation in these areas to be supported through various funds.

An ‘Advanced Manufacturing Growth Fund’ will commit to spending $47.5 million over two years ‘high value’ manufacturing in South Australian and Victoria. Additionally, $4 million will be available through the Advanced Manufacturing Growth Centre for the support of “small scale and pilot research projects in advanced manufacturing”.

Other varying sums have been set aside by government for “manufacturing research projects”, “innovation labs” (test facilities) and engineering studies at tertiary/technology institutions.

Opposition parties slam paper

Unsurprisingly reaction from opposition parties upon release of the Federal Government’s response was swift and savage with detractors noting the timing of the response.

Senator Nick Xenophon likened the Federal Government's response as "a driverless car stuck in reverse gear. The Government's pathetic response is almost two years overdue and mostly flies past many of the recommendations that were made to address the serious state the industry faces only a month before Holden and Toyota close their factory doors in Elizabeth and Altona," Senator Xenophon said.

According to Senator Xenophon, the government’s response has ignored two key recommendations in the report: an automotive taskforce to address a severe skills shortage in the industry and extending the ‘under-spent’ Automotive Transformation Scheme (ATS).

Shadow Minister for Innovation, Industry, Science and Research, Kim Carr, said “the response is a true reflection of the Abbott/Turnbull Government's apathetic attitude towards the automotive industry. We find ourselves facing the closures of Toyota and Holden next month, purely because the Liberals failed to see the value in retaining this high-tech, advanced manufacturing industry and the high-skilled, high-wage jobs it sustains.”