Feeble AiG congratulates Ford

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The hapless AiG, the most ineffectual lobby in Australia, has responded to the Ford closure today thusly:

“Today’s announcement by Ford that it will end production at its Broadmeadow and Geelong plants in 2016 is a watershed moment in Australian manufacturing,” Ai Group Chief Executive, Innes Willox, said today.

“The loss of 1200 jobs over the next three years is deeply concerning as are the implications for the many businesses and employees linked into Ford Australia’s assembly operations in Victoria. We welcome any support that can be given to those employees impacted both directly and indirectly. A key part of transitional support for employees should be assistance in reorientating the businesses in supply chains linked to Ford’s domestic assembly operations and in developing new opportunities, particularly in export markets.

“As Ford has stated, the economic conditions in Australia are very tough for trade exposed industries and while the dollar has come off its highs somewhat over the past few weeks, we remain a high cost economy. The still-strong Australian dollar is part of this as are our rising energy costs and the continuing growth in domestic real unit labour costs.

“It is very welcome news that Ford has recommitted to maintaining and reinvesting in its domestic design facilities for product development and that it will keep a significant research and development presence in Australia. Despite very tough trading conditions, over the past six years Ford Australia has spent close to $2 billion on R&D in Australia. Ford Australia’s commitment to an Australian centre of excellence highlights the depth of world-class manufacturing capabilities in this country.

“Ford’s decision to continue to build on its domestic design and R&D capabilities points very clearly to major areas of strength upon which new Australian manufacturing activities can be built and existing activities transformed. Adding value through design, technological, product and process innovations is a core direction for the future of Australian manufacturing. The challenge is to nurture and to develop these capabilities and to link them to global opportunities.

“Many Australian manufacturers are exploring and indeed realising these opportunities and many more have the potential to do so. There is a role for policy to communicate these opportunities and to facilitate the transition, particularly among our small and medium-sized manufacturers. These policy directions are important not only for the individual businesses and their employees but also for the broader economy which has become increasingly exposed to resource exports and commodity price fluctuations. We need to build a balanced and diversified economy to address the risks in the current structure of the economy.

“Encouragingly, a range of recently-announced policy initiatives are focussed in these directions. It is imperative that these initiatives are continued, refined and expanded over the next couple of years.

“As we have said, the Australian auto industry is worth fighting for and while this announcement is a major blow for all concerned we still have competitive auto makers and parts manufacturers in Australia who are adapting and building export markets,” Mr Willox said.

Blah, blah, blah. Where’s the fire and brimstone? Where’s the “manufacturing crisis” rhetoric? Where’s the massive advertising campaign? Where’s the threats of electoral wipe-out without support?

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About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.