Roughly twice a year, Australian media goes on a little
crusade to try and “reveal” the level of assistance which domestic
manufacturers are currently receiving from Federal and State coffers. And, as
inevitable as the rising of the sun, opinions fly about the viability or value
for money obtained through these continual hand outs. To be honest, it’s
pissing me off! Not the government support. Not even the genuine concern that
other Australians have about the current circumstances surrounding our
manufacturing industry. It is the unfounded, and often, inaccurate rhetoric
that is passed on as facts. Still, you can’t expect everyone to know everything
about …everything, so here are a few (literally just a general run down) of the
key facts about Automotive Manufacturing in Australia.
Let’s have a look at some of the circular arguments that
always seem to materialise:
They’re not even Australian Companies! They
don’t even use local content!
Yes, local cars do have content from foreign manufacturers.
It’s a global market place. But, making a price competitive, wholly Australian
built car with 100% Australian content could only be done with manufacturing
subsidies which would tower above the current level of public investment.
Aside from that, tell
me Arm Chair Industry Ministers, which car are you going to buy? How much local
content is there in fully imported vehicles? More than you think, but obviously
not as much as locally assembled products.
Most of the engines in Australian built cars come from
Australian manufacturing plants.
The money just goes off shore to the foreign
owners!
The overwhelming majority of government assistance goes to
LOCAL research and development. Funds are utilized to engineer powertrains
(such as engines, drivelines and gearboxes) and domestic products, to better
suit Australian tastes and conditions. Holden is a leading Design Centre for
the infamous US Bogey man General Motors, as is Ford Australia for their evil
foreign overlords (just accept the sarcasm okay? I’m all out of smilies). As a
result, their expertise, and thus, a small portion of your investment (assuming
you pay taxes) does benefit the foreign parent company. The return on that
investment is an international reputation that puts them in favourable stead
for winning future business. Which brings me neatly to the next Furphy (if you
don’t know what a Furphy is kids, google it).
They
aren’t innovative enough. They’re still building Dinosaurs. They’re no longer
relevant.
This is probably the most ridiculous of all misconceptions (considering 4 of the top ten in Oz are Australian made),
so I’ll address it individually by manufacturer:
Toyota
They still build the most popular mid size car on the
market; the Camry. Not only is this Camry widely sought after in the used car
market (it’s not my kettle of fish, but plenty love it) but it is also a staple
of fleets looking for a reliable, cost effect vehicle. Aside from the new
generation (just arrived), Toyota also locally assemble the Camry Hybrid. What
the Hybrid lacks in driver involvement, it makes up for in impressive fuel
economy. Try 6.0 litres/100kms (ADR Rated).
Toyota Australia used a large
portion of government research and development funds to instigate a local
engine manufacturing plant. Both, the Hybrid, regular Camry, and their V6
sister car, the Toyota Aurion, are all built right here in Australia. Last year
they built around 94,000 examples for local sale and export.
Ford
Ford Australia has had a tough run with their parent company
placing the Oz manufacturing arm in a less than favourable position. Despite
the Falcon beating Ford Taurus (a gargantuan FWD monstrosity) in packaging
(interior space) and beating their halo SHO model (a gargantuan all wheel drive
monstrosity) to the punch with Euro IV (that’s an emissions standard kids.
Again with the googling) compliant turbo charged 6 cylinder, which would out
drive it any day of the week and twice on Sundays, Ford North America declined
and denied any opportunity for export.
Nonetheless, the Ford Falcon continues to innovate, with the
all new LPG system bolting onto the Australian made in line 6, which shames
many 4 cylinder cars for Carbon emissions and running costs, whilst returning
better power than the regular Petrol iteration.
Their impending
Ecoboost 2.0 direct injected turbo engine is apparently worth raving about and
is the first time the global powerplant has been used in a RWD vehicle anywhere
in the world. Economy is likely to scare most mid size vehicles and rightfully
shame many compact and mid-sized SUVs (Don’t kid yourself; just accept that you
bought a mini-van).
Last, but not least, Ford Australia also engineered the much
needed diesel V6 (originally from Land Rover) to slot into the Territory. It
pulls like a truck (I recognize that many inner city folk don’t need to tow,
but I didn’t exclude the merits of the Camry, so recognize the skills okay) and
can handle most anything Australia can throw at it (unlike Mercedes G-Wagens
which get stranded in the desert awaiting rescue).
Holden
If the Commodore is such a dinosaur, why has it sold more
units in Australia for the last 16 consecutive years? That’s right: 16. Mazda 3
outsold the sedan and wagon by a few hundred units this year, but ute sales are
not included, as they are classed as a commercial vehicle. That is despite the
fact that the base model is now only built to order. The sport models are far
and away the biggest sellers.
The HFV6 engine has dedicated engineers who work tirelessly
to improve economy yet still gain power, and, both the 3.0 litre and 3.6 litre
units are built right here in Australia (Port Melbourne to be exact). The 3.0
litre has it’s own throttle mapping to match Australian tastes (the US 3.0 has
a sky high pek torque) . Both versions (and the GM Power train V8) can all run
on 85% ethanol. In case you didn’t know, ethanol is a renewable energy source
that can be extracted, not just from regular organic sources such as sugar
cane, but also household rubbish and old car tyres.
Have a guess who is investing in the business case for a
garbage munching ethanol plant in Victoria….
That’s right; Holden (and their partners) are investing in other industries, with the potential of creating more jobs outside of their sector.
Beyond the Commodore, Holden also locally manufactures the
Cruze sedan and hatch. Boasting the largest interior in it’s class and
competitive pricing, the Cruze also offers buyers a choice of 1.8 petrol, 2.0
diesel and a turbo charged 1.4 petrol (unlike Japanese and European turbos, the
Belgian sourced 1.4 can run on regular unleaded). After 2 years on the market,
it falls nicely into the top 5 best selling vehicles in the country. Don’t
forget that: both sedan and hatch are made in Australia. For some reason, many
people seem to have trouble grasping that point.
Did you know that all of them are built on the same assembly
line in Elizabeth, South Australia? No, not just the Cruze sedan and hatch. I’m
talking about the Cruze sedan and hatch (in four different specifications, with
manual or automatic transmission and 3 different engines) as well as the
Commodore sedan, sportwagon, ute, Caprice and Chevrolet Caprice PPV (google)
which offer 3.0 and 3.6 Direct injected V6, 6.0 Litre V8 with AFM (you should
really have google open in a separate tab by now) and associated gearboxes.
This has been done so that Holden can respond to market shifts as swiftly and
efficiently as possible.
Oh, and they also export to China as a Buick.
Remember, this is just the manufacturing side. I assume you
are starting to glaze over by now, so I’ll just generally tell you that Ford
Australia was lead developer for the new Ford Ranger (which is sold across most
of the planet). Holden is also doing development work for Buick and Chevrolet.
Let’s cover the international design and R&D side of things another day
mkay? All righty then.
So let’s just summarise with another old chestnut.
It’s protectionism, pure and simple.
Well duh. It is protecting one of Australia’s greatest
assets: the manufacturing industry as a whole. There is an estimated 200,000 of
your fellow Australians building, designing and innovating across the country.
Not all of them rely directly on the Automotive industry, but most will take a
severe hit if the three local manufacturers go down the gurgler. Just think for
a second, what effect that will have on state and federal revenue, not just
through personal income tax, but our reliance on importing goods, and, as
skills decline, the importation (or off shore outsourcing) of professional
services. How can states build infrastructure when you can’t pay for it?
What it isn’t, is Isolationism. In reality, our level of
protection for the Automotive industry is actually the lowest in the developed
world. Germany has a significant finger in its Automotive pie (German state,
Lower Saxony, owns 20% of VW) and in China, you can’t even build a car unless you
enter into a joint venture with a State owned company.
We tried to play fair
with Thailand, entering into a Fair Trade agreement, and they stiffed us by
introducing big fat tax on six cylinder cars (essentially eliminating any
opportunity for our products to reach their shores). Conversly, here are a few vehicles we import from Thailand:
Toyota Rav-4 and Hilux, Nissan Navara, Honda Jazz, Civic and Accord, Ford Ranger (Mazda BT-50) and Holden Colorado.
For us, imported
vehicles are hit with a piddling 5% tariff. Most of those products come from
countries where workers do not enjoy the level of rights, nor the standard of
living that we have in Australia. Don’t let anyone tell you that the luxury car
tax is to blame either. That only kicks in above $57,000, so there is no excuse
for Audi to cry poor when you have to pay for options in their base model A3,
like cruise control and pockets in the back of their front seats (really, you
can’t make this stuff up).
So next time you are at a dinner party and the discussion
turns to the local Automotive industry, don’t be a chicken shit and shake your
head in disapproval with the rest of the know-nothings (there is no excuse now that you know the facts).
Be proud
of what the local manufacturers are doing. Their products are Australian cars
built for Australian conditions, by Australians and for Australians (and occassionally, the middle east, Asia and potentially...North America come MY2014).
Four Australian built cars in the top ten can
attest to that.
Why don’t you instead ask why, despite our sky rocketing
Australian dollar, does it still cost tens of thousands of dollars more to buy a
European marque than the equivalent model in the US. After all we just hit parity. Or is
that parody?
Disclaimer: some of those European cars may not actually be built
in Europe. Try South Africa. Shhhhh, it’s a secret.
The truth shall set you free.
