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Australia risks auto industry collapse, down to one car manufacturer within next few years
Topic Started: 28 Jan 2012, 08:36 PM (8,552 Views)
Gossamer
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themoops
4 Feb 2013, 05:29 PM
Shameful. You're all a bunch of poxy, smelly, soccer mums and dads driving Asian and Euro 4WDs.

Just buy a fucken Commodore you scum.
I'd rather buy a Falcon. And they will become collectable after 2016 when Ford stop local production.
Common sense is a curse - those who have it need to suffer dealing with those who don't have it.
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Alex Barton
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Decision made: GM will shut without a labour deal

Robert Gottliebsen
24 Jun, 8:09 AM

Make no mistake, General Motors in the US is not bluffing. If there is no new labour agreement with its Australian workforce within six weeks then Australian manufacturing will cease.

The only two questions to be decided by Detroit are whether the cessation announcement is made before or after the election and the actual date that production will shut. In my view, because the decision to close without a satisfactory labour agreement has already been made, the closure announcement must be made before September 14.

GMH Australia managing director Mike Devereux made it clear to the American Chamber of Commerce luncheon in Melbourne on Friday that General Motors was not bluffing and said he believed that Toyota and General Motors both need to make cars in Australia for the parts industry to be viable.

So if there is no GMH labour agreement in six weeks and General Motors shuts down, then Toyota may announce it is shutting soon after.

The big union bosses think General Motors is bluffing. But in any event many would prefer General Motors and Toyota to shut, along with the entire Australian components industry, rather than make precedent setting concessions.

And it’s not easy for the unions because GMH says that the Australian talks will not be a “negotiation”, rather they will be a “discussion”.

That’s exactly what General Motors did this year at the Bochum assembly plant in Germany. The unions said General Motors was bluffing and in March, after a "discussion", rejected the General Motors labour deal. A month later, in April, Detroit announced that the plant would shut in 2014.

The bulk of the General Motors Australian workers on the front line are at Elizabeth in South Australia. There is no certainty that they will go along with the union bosses in Sydney and Melbourne. On Thursday I described the General Motors labour deals in Australia as “workplace agreements from hell” because they give the unions the power to manage much of the plant (Dollar’s decline sends a clear warning, June 20).

Ken Phillips described how the Ford unions actually decided to strike to get a similar agreement to GMH. The Ford workers ‘won’ but for both Ford managers and workers signing that agreement was their death warrant (The union hand on the wheel that doomed Ford, June 19).

Workers at Ford have only themselves and their unions to blame for losing their jobs. But at Holden the remarkable feature of the workforce is that they do not enforce many of the more onerous provisions of their labour agreement and five years ago took a temporary pay cut to keep the plant going. Nevertheless, if General Motors managers want the plant to operate when it involves worker overtime, management now wants the power to make that decision – not the unions, as is now the case (there is no issue with penalty rates). Detroit insists that the Australian labour agreement must be consistent with its world plants, subject to the Australian labour laws.

Without warning, Ford simply dropped the guillotine on the jobs of their managers and workers. General Motors is giving the workers and managers a chance to keep their employment. There is at least a possibility that GMH workers will want employment rather than the dole and defy the union bosses.

And given that the Elizabeth area of South Australia is one of the more depressed areas of the country, most General Motor’s workers know what living on the dole is like. And their looming retrenchment comes as the big mining construction plants will be completed and the workers go back home to seeks jobs.

If General Motors and its suppliers shut, as is likely, South Australian unemployment will rise well past 10 per cent. Victoria is more affected by Ford than GMH but with returning mining construction workers, unemployment in Victoria will rise sharply.

But what worries the unions more than unemployment is that if the General Motor’s workers agree to a ‘sensible’ work place agreement and take a pay reduction then it may spread around the country.

But even if General Motor’s workers agree to abolish their work practices and powers, it does not save the company in Australia. There will need to be cost reductions over a wide range of areas, including electricity pricing, and finally the federal government will need to come to the party.

Mike Devereux says that every motor industry in the world receives some form of government help – it’s a globally competitive business. It’s unlikely that an Abbott government would help any company that had a “workplace agreement from hell”. “Get your house in order first”, it might say to General Motors (and Toyota).

It is possible to operate General Motors profitably in Australia because the latest Commodore will be exported to the US. Australia is a world leader in rear wheel drive cars and that’s how we can overcome the tyranny of scale. Toyota has similar plans for the Camry.

Read more: http://www.businessspectator.com.au/article/2013/6/24/automotive/decision-made-gm-will-shut-without-labour-deal
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Thatguy
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The industry should have been canned 15 years ago. The money SHOULD have been spent on industries we have a natural advantage in, or at least cost neutral.

The idea of building and exporting 1.5 tonne+ cars from the most sparsely populated and remote continent on the planet is mind-bogglingly stupid. It's more ridiculous than Madagascar or Sri Lanka becoming competitive car producing countries (similarly populated island countries).

The automotive production industry is a massively interconnected production line where the supply chain must be thoroughly integrated and operating with huge economies of scale. Why subsidise to compete against countries such as Germany, Japan, China and USA ? It's a losing battle.

Instead the money should be going towards areas that Australia is naturally competitive. Quality food production (good idea from the Liberals), sustainable eco-industries/tourism, IT, science, medical research. Plus any other areas where you can make a few hundred million and the shipping costs are a tiny fraction of the revenue.
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newjez
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Count du Monet
21 Jul 2012, 03:48 PM
Did the truck drive over you and your car? How did you manage to survive?
Trucks have brakes they just don't like using them. Why did this old chestnut pop up?

I guess the question that needs to be asked is - does australia need an auto industry?
Edited by newjez, 25 Jun 2013, 03:40 PM.
But anyway, nothing goes up in a straight line with a positive slope coefficient. I think you'll find that Skamy et al have a need to react to whatever they perceive as a directionally incoherent trend. However, if you read the commentary correctly, this was never about the price of Perth houses anyway; it was about market listings. Nothing wrong with knee-jerk reactions if you can sense danger, but I would expect more faith from my brethren on this.
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themoops
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Thatguy
25 Jun 2013, 02:07 PM
The industry should have been canned 15 years ago. The money SHOULD have been spent on industries we have a natural advantage in, or at least cost neutral.

The idea of building and exporting 1.5 tonne+ cars from the most sparsely populated and remote continent on the planet is mind-bogglingly stupid. It's more ridiculous than Madagascar or Sri Lanka becoming competitive car producing countries (similarly populated island countries).

The automotive production industry is a massively interconnected production line where the supply chain must be thoroughly integrated and operating with huge economies of scale. Why subsidise to compete against countries such as Germany, Japan, China and USA ? It's a losing battle.

Instead the money should be going towards areas that Australia is naturally competitive. Quality food production (good idea from the Liberals), sustainable eco-industries/tourism, IT, science, medical research. Plus any other areas where you can make a few hundred million and the shipping costs are a tiny fraction of the revenue.
I like them.

The car industry is a minuscule burden. You'll only save about $1k on a Corolla or some such, if that, if the government intervention was removed, and you being a bull, you have zero right to have any say on any industry being propped up.
stinkbug omosessuale


Frank Castle is a liar and a criminal. He will often deliberately take people out of context and use straw man arguments.
Frank finally and unintentionally gives it up and admits he got where he is, primarily via dumb luck!
See here
Property will be 50-70% off by 2016.
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Thatguy
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themoops
25 Jun 2013, 08:50 PM
I like them.

The car industry is a minuscule burden. You'll only save about $1k on a Corolla or some such, if that, if the government intervention was removed, and you being a bull, you have zero right to have any say on any industry being propped up.
So you want the government to pay money to an uncompetitive industry because ??? You prefer building Falcons and Commodores to developing new medicines and technology to improve peoples lives all around the world?

Because we've got to waste money somehow so why not waste it on some notion of bogan pride, even though we know it's a waste? Shouldn't we be encouraging employing people in the most productive jobs possible?


On a more veterinarian point: try not to be as pathetic as the bull vs bear people on here, it's getting tiring keeping up with what species of animal I am. On a political note do all bulls have less rights than bears? Is this the Animal Farm? I thought we were all equal but some were more equal than others ? Or does it come down to size, life expectancy or brain function? I mean, we all know that flies have no rights, don't we?


OK so government spending on the car industry for the near future is $200m per year (actually a bit more). That money could be spent to TRIPLE the federal money spent on the dairy and wool industries. Currently roughly $50m is spent on each.

Alternatively we could double federal "rural assistance" programs.

Nut nahhh....Moops "likes them" so we'll keep spending that money so he can buy his favourite gas guzzler at a discount.
Edited by Thatguy, 26 Jun 2013, 12:13 AM.
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Sheepdog
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Thatguy
25 Jun 2013, 02:07 PM
The industry should have been canned 15 years ago. The money SHOULD have been spent on industries we have a natural advantage in, or at least cost neutral.

The idea of building and exporting 1.5 tonne+ cars from the most sparsely populated and remote continent on the planet is mind-bogglingly stupid. It's more ridiculous than Madagascar or Sri Lanka becoming competitive car producing countries (similarly populated island countries).

The automotive production industry is a massively interconnected production line where the supply chain must be thoroughly integrated and operating with huge economies of scale. Why subsidise to compete against countries such as Germany, Japan, China and USA ? It's a losing battle.

Instead the money should be going towards areas that Australia is naturally competitive. Quality food production (good idea from the Liberals), sustainable eco-industries/tourism, IT, science, medical research. Plus any other areas where you can make a few hundred million and the shipping costs are a tiny fraction of the revenue.
Ok so what industry would that be?

Digging shite out of the ground and selling it to someone capable of refining or just hoping that our natural vistas attract tourist from other countries to come and look at them?
So please tell me how Germany is competitive in this market???
My argument is always "If Germany can do it, why cant we?"
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newjez
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What Australia needs is to bring back an iconic classic from it's past - like the beetle, or the mini, or the fiat bambino. Oh damn - I see the problem. FJ anyone?
But anyway, nothing goes up in a straight line with a positive slope coefficient. I think you'll find that Skamy et al have a need to react to whatever they perceive as a directionally incoherent trend. However, if you read the commentary correctly, this was never about the price of Perth houses anyway; it was about market listings. Nothing wrong with knee-jerk reactions if you can sense danger, but I would expect more faith from my brethren on this.
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Gossamer
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Almost difficult to believe that today is one year since I left the auto industry. Was upset when it occurred but now I see that it was inevitable as many more have or will be losing their jobs in this industry.
Common sense is a curse - those who have it need to suffer dealing with those who don't have it.
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Alex Barton
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A brake on Holden’s death spiral

Matthew Wright
1 Jul, 10:30 AM

Every Australian knows that feeling of pain and fear as they pull up at the petrol pump, not knowing what the price is going to be, not knowing if they’re going to have enough change to buy the week’s groceries.

But what if the fear we’ve been experiencing with our petrol-fuelled cars is needless and that with a simple switch we could know exactly what it is going to cost every time we want to go driving?

The future of the car industry globally and the future of the Australian automotive industry is in electric vehicles – cars that are environmentally friendly and cheaper to own and fuel – which the Australian car industry refuses to produce.

Unfortunately, by handing out over $4 billion over the past decade, our government has been encouraging our car manufacturers such as GMH (General Motors Holden) to supply us with cars so costly that they inflict petrol pump pain on ordinary Australians daily.

Despite having gifted Holden $2 billion in hand-outs over the past decade, the old car manufacturer still does the rounds ‘cap in hand’ asking for even more handouts at any and every opportunity. And for our money Holden wants to just build more of the same out-of-date gas guzzling vehicles when it should be building modern electric ones.

Through its 34-year old Commodore platform (or any platform running an exclusively fossil fuel drive train), Holden is building a product that is antiquated and at least a decade out of date.

And building an outdated car means that the advantages of subsidising and hosting a car manufacturer are significantly diminished. What value is building a knowledge base and skillset for skills and knowledge that is 20 years out of date? How can sticking by 19th century technology transfer value into other sectors of the economy and breed innovation in activities that are internationally competitive when our competitors are working with 21st century know-how?

By contrast, an up-to-date car industry has opportunities for creating local knowledge in a wide range of sophisticated skill sets immensely valuable to industry in a dynamic and ever changing marketplace.

For the past decade Holden has been afflicted with a serious case of MAD (Managed Adaptive Decline), shown by its ever falling sales and production, culminating in revenue well below what’s profitable.

Instead of looking at the fundamental cause of the problem, a number of band-aids have been applied to stem the flow, of what amounts to a ‘gusher’ of a war wound.

The bandaids, pitiful attempts including taxpayer subsidies to fix the same old problem over and over by doing tomorrow what they did yesterday, cutting workforce numbers again and again, and now the latest gambit by managing director Mike Devereux is to cut existing workers’ salaries and entitlements, as reported in The Age last week.

In the 1920s the gas industry was trying to get us to buy ‘all gas homes’ with crazy gas appliances like the gas clothes iron, washing machine and even a cooling fan as a last ditch desperate effort to stave off the inevitable wholesale market switch to electricity.

But when a superior energy source – electricity – came along, gas was flicked away for something more versatile, less wasteful, cheaper and safer.

Today, gas isn’t the only dirty industry gasping for life. The car industry is suffering a similar fate, teetering on the edge of collapse.

The difference between the future of the fossil gas industry and the car industry is that the latter can still change direction with two modern products that 21st century consumers will soon demand: ‘pure electric’ or ‘plug-in hybrid electric’ vehicles that don’t cost the earth to run.

The Labor government, Abbott-led Opposition and the Independents must not back another dollar going the way of these car manufacturers until they commit to retooling electric.

In the case of General Motors, it would mean that Detroit would agree to an equity stake being taken in the local operation akin to the Obama auto bailout of 2009, a case in which the government agreed to subsidise US car companies provided they produced more efficient electrical cars.

Australia’s commitment to General Motors would be conditional on the local operation having full intellectual property rights to the GM Volt platform, allowing for local research and development and a return to the local business and/or Australian people for any local innovation that makes it back into the American version of the car.

Zero Emissions, the organisation that I represent, is calling for a special action plan.

Under the plan the government sets up a fund to retool the Australian automotive industry to build pure 'plug-in electric' or 'plug-in hybrid electric' vehicles. The government offers an amount in the order of an upfront $8,000 subsidy to buyers on the first 10,000 electric vehicles produced in each Australian car manufacturing plant. This can then be followed by a lower subsidy for the next 10,000 vehicles and so on.

There is no advantage building a Hybrid here as Toyota is doing, that’s the late 90s, nor is there any point in further funding a product such as Holden’s V8 that turns off 4 of its cylinders at a time making a slight different to fuel consumption. We need to move on to vehicles that are powered at the plug and can be powered with renewables.

The Australian automotive industry needs a revolution and that involves moving each of the car manufacturers platforms from old petrol drive trains to simpler, more elegant and efficient electric drive trains.

By electrifying the Australian fleet, the bulk of which will occur over 10 years, we can beat fuel prices rises and avoid the pain at the petrol pump that is hurting so many Australians – instead running our cars on safe renewable solar and wind power.

And the price? Just under $40,000 for the US version.

In March GM said the 2014 version would be $10,000 cheaper. For comparison, the average Tasmanian government car cost $58,000.

There is an opportunity to make all Australian government fleet and other cars that are sold with subsidy, such as preferential tax treatment, electric and in doing so drive the Australian car industry to success.

Come on Holden, come on AMWU, come on Canberra, come on Aussie – let’s give Aussie workers a fair go, give Aussie workers electric vehicles to build.

Read more: http://www.businessspectator.com.au/article/2013/7/1/climate/brake-holden%E2%80%99s-death-spiral
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