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End of the road for carmakers: Where now?
The decision by Holden and Ford to close their doors in Australia has sent shock waves through the manufacturing sector.
The closure of these two automotive giants represents the end of an era for Australian car manufacturing.
Ford, Australia’s oldest automotive manufacturer, will close its Australian manufacturing plants in October 2016, with the loss of hundreds of jobs.
And General Motors has confirmed it will cease manufacturing in Australia the following year.
Toyota has also recently announced it will cease manufacturing in Australia in 2017.
More recently SPC Ardmona announced it would sack 73 workers at its Goulburn Valley processing plant as the struggling company fights for survival.
Just as the government has closed the door on future hand-outs to the automotive industry, it has firmly rejected SPC's plea for $25 million towards a restructuring package.
The government’s stance has renewed debate around government-subsidised industry sectors.
But would these government bailout packages make any difference?
They are merely a band-aid solution for a far more serious problem – it is becoming increasing difficult to compete against cheap labour nations.
So is there a future for manufacturing in Australia?
Absolutely. But obviously we must find ways of doing it “smarter” than many of our competitors.
If there is to be no more large-scale car manufacturing, it is imperative to look for viable alternatives.
To achieve this a collaborative approach is needed between all relevant stakeholders – government, unions and employers. There is a need to focus on developing skills within the work force.
Rather than throwing taxpayer dollars into flailing Australian manufacturing industries, a more considered approach is needed. Perhaps we should focus more on technology design and development.
Perhaps we should become a more “specialized” within the manufacturing sector.
There is no reason why Australia could not become a world leader in designing and building car components or in designing computer systems in cars.
To achieve this, there must be an agenda for growth.
A long-term economy plan is urgently needed with consensus and consultation from all key players.
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