Labor to co-invest for return of car industry

Via the ABC:

Tens of millions of dollars will be offered to the world’s automotive giants to resurrect the Australian car industry, centred around manufacturing electric and hydrogen-powered cars, under a yet-to-be unveiled Labor plan.

The ABC has learned the Labor Party has been quietly working on the plan for the past couple of years, with high-ranking executives from the United States travelling to Australia to discuss “co-investment” options with Opposition figures.

It is understood Labor plans to offer major carmakers research and development grants from a $1 billion fund aimed at re-stocking Australia’s manufacturing sector.

Labor wants 50 per cent of all new car sales to be electric vehicles by 2030 and it believes many of them should be built in Australia — potentially using repurposed car factories in South Australia and Victoria.

Australia’s last mass-produced cars rolled off the production line in October 2017, when Holden closed its Adelaide plant. Toyota closed its Altona plant in Victoria the same month, leaving 2,500 workers redundant.

Ford stopped production at its Geelong and Broadmeadows plants in October 2016.

Labor leader Bill Shorten has hinted at his plan for a car industry renaissance in recent days, saying he wants Australia to be a “manufacturing nation”.

In his Budget reply speech, Mr Shorten said he wanted Australia to use its vast natural resources of lithium to create an Australian battery industry.

“So instead of the usual trope of shipping the minerals overseas and buying back the finished product at vastly inflated prices, let’s make the batteries here,” he said.

“And let’s do this with electric vehicles and charging equipment and stations too.”

Labor industry spokesman Kim Carr argues that the car industry is far from dead in Australia, with thousands of skilled workers, automotive engineers and designers ready for deployment as part of an existing “ecosystem”.

Australian manufacturers of automotive components exported $862 million of goods in 2017-18 and while cars are no longer being mass-produced in Australia, Ford still employs 2,100 people in its design, research and development divisions.

Holden GM has announced an expansion of its engineering and design workforce to 500 and Toyota has 160 working in R&D, specialising in hydrogen technology.

Firms active in the Australian automotive sector include Bosch, Unidrive, Nissan Casting, Carbon Revolution, MHG Plastics and Seeing Machines, which is working with Holden on autonomous vehicles in Canberra.

Queensland company ACE Electric Vehicles is building a $40,000 two-door electric van pitched at small businesses and companies. It wants to have 100 built this year in its Brisbane factory.

There are 65 firms still registered with the Automotive Transformation Scheme, which will distribute $1 billion between 2016 and 2020 to motor vehicle producers and component manufacturers who invest in research and development and innovation.

Senator Carr last week launched the Australian Manufacturing Workers Union’s industry blueprint with a pledge to boost the sector.

“We will forge an alliance of blue collar and white coat, to rebuild the industrial system for the 21st century,” he told the AMWU.

Well it’s damn side better than bringing in millions of coolies to crush wages and drive up house prices.

Comments

    • “Cleaner to the PM’s office stat! We’ve got a Code Brown. I repeat we have a Code Brown.”

    • So Shorten mouths off a few platitudes!!! Another one of Labor’s well researched plans? It’s another brain fart! No thought as to what it would take. No thought as to what caused the demise of the car industry previously! No thought about the economic policies, especially the valuation of the A$ necessary to achieve anything. No thought as to the very REAL consequences of those policies! Just make a bloody announcement on motherhood (that he doesn’t believe in anyway) and the ABC, Guardian, SMH, Channel9 .MB et al portray him as some kind of bloody hero genius.

      In the old days one would say this country has gone to the dogs….but dogs are really seriously good animals. We’re infected by a bunch of narcissistic self-serving stupid treacherous pricks in politics and the media who now control the vital organs and bloodstream of the national body

      • GunnamattaMEMBER

        I don’t think it’s a brain fart, I think it is what the article says – considered.

        Nobody would brain fart bringing back the car industry, or Australian manufacturing.

        But (and it is a big but).  The implications of this are huge – and I kind of admire some aspects of the vision.  The ALP would be saying we are planning on crafting the economic conditions in which manufacturing is viable, and delivers an environmental outcome (which is why I think the plan is considered).  And to do that they need to address all those things regularly touted here at MB.

        Land costs
        Taxation structure and capital allocation
        Skills
        Energy

        They are really going to have to work to make the plan work.  If it is a brain fart of the throw some money and get someone to make things in a shed at Elizabeth or Broadmeadows then it will be cruelly exposed in a very short timespan.

      • Ummmm….a single piece of evidence that this is not just another Labor brain fart would be good! Some evidence that the necessary economic and social changes will be made to turn Aus back into some sort of manufacturing vehicle; So far we have just got – “we are going to throw a billion dollars at this motherhood statement”

        To propose ANYTHING in this country without addressing the BIG issue of the extraordinarily over-valued currency is just BS words flung out carelessly to make ‘me’ sound good or ‘çoncerned’. There is not one of these pricks who want to do anything but sound good and concerned.

    • I gotta say – informal is looking bloody good to me!
      I really seriously want to vote for someone who has DONE something other than get a job as secretary to some stupid political moron and climbed the slimy political ladder to a seat nomination. Someone who isn’t a scumbag lawyer for a start! Someone who has actually worked at something – has had his head down and arse up for part of his/her life and then, preferably, got kicked around for his/her trouble.
      Sorry I’m coming over obnoxious these days. I’m just so sick of the stupidity that seems to be everywhere in increasing steaming piles.

      • Ronin
        I take your point. Also such a person could not get elected to any damned thing. The nation has been hijacked by this central city elite who just know everything and how exactly everyone should think.

        Nevertheless, maybe, somewhere there are still men/women who really care and willing to make (close to) the ultimate sacrifice.. Damned if I know!

      • “I’m just so sick of the stupidity that seems to be everywhere in increasing steaming piles.”

        Have we reached the “peak stupidity” yet? Nah, I am afraid you should prepare for more idiocy, at least in the short term. The Moron Side of the Force is still strong after all.

        I wonder how the Minsky moment might look like.

      • kannigetMEMBER

        Dont vote informal. a Politician only needs to get 50% of VALID votes, when you donkey vote you are making it easier for the parties to get their candidate in. If you dont like either party, go below the line, vote by starting at the biggest number and work backwards. Give the biggest numbers to the Parties, then the kooks, the drongos and the looks. You should end up with one left to give you number 1 vote to. They will be the least crazy choice out of the lot.

        Please dont waste your time going down to the polling booth by giving your vote away, make it count the least to the people you dont want in.

  1. ErmingtonPlumbingMEMBER

    Toyota were already halfway there with their Camry Hybrids.
    The Taxi operators were all preferring them (Camrys) and Toyota were exporting almost 50,000 of them per year from our shores.
    Having 3 Manufacturers in 25 million person Australia was probably to much, but one manufacturer with guaranteed Government procurement (police cars, local state and federal staff vehicle etc) would easily have Toyota manufacturing here again.
    There are regional security reasons to have an Australian/Japanese technology partnership also with shared R&D, supply chains, marketing and sales.
    China has become 1930s Germany,….it’s time to work together with our regional Democratic Allies.

    I would go farther with the mandating that all taxi and Uber type services must use locally produced vehicles as well as Govie vehicles,…in return Toyota (and maybe one other) would have to work in partnership with the Australian Government to meet its environmental/vehicle emissions targets with Australian made hybrid and full electric vehicles.

    All Trains, Busses and coastal shipping along with steel should be Australian sourced also or carry heavy tariffs.
    Its ridiculous that the biggest Iron and coal exporting country in the world with 100 years of steel making experience,…Imports steel!
    The Revenue from those Tariffs can go towards Income tax cuts

    • GunnamattaMEMBER

      I will vote for you as industry minister if

      1. You get yourself a speechwriter/correspondence editor
      2. You change this tax cuts to ‘Residential Mortgage offsets’ for families on a household income of less than 150k on mortgages for houses less than 800k (or maybe a million) enabling the write off of mortgage expenses for houses which are greenhouse and energy compliant

      • ErmingtonPlumbingMEMBER

        Thanks for the endorsement Gunna,..but I will never be on that ticket.
        If such an honor was thrust upon me though then Id go the full Rex Connor.

        It is true that I write like a Plumber and I make no Apologies for that!

        As for Harry’s item #3, well that reminds me of a distasteful anecdote I could share concerning a nasty surcharging sewer choke I sorted out the other day in melrose park at a property that backed onto the Golf course.
        The owner swore that his family didn’t even eat corn and yet corn WAS everywhere. I explained to him that this is a common phenomenon and a plumbing mystery that will probably never be solved.
        He declined my offer to collect said kernels for later consumption even after I explained the many environmental benefits of recyclable food stuffs.

      • ErmingtonPlumbingMEMBER

        Now thats a good idea Gunna!
        A children’s book!
        Maybe we could co-write it,…together!,…on the Piss!
        What should it be about?
        What about a secret agent and Kangaroo fighting over a handful of Corn?
        No,…it’d have to be something the Kids would be into.

        https://youtu.be/wj5r9atKMLQ

        But what if we became as successful as J. K. Rowling?,…all that money and power might go to our heads!,…we might become all vacuous and unWoke!

        https://youtu.be/yKwzNbGUuC4

      • I’m in as long as gunna supplies the other type of “carrot”. I’ll bring the Cab Sauv.

      • GunnamattaMEMBER

        Chapter One

        T’was in the outer urban Australian suburb of North Nutscratch that three young mates, Ermo, Haroldus and Gunna, used to like to wag school from time to time.  It wasn’t so much that they didn’t like school, because they actually did, but more that they felt they were enhancing their school experience by adding to it with extra-curricular activities, and that the school curriculum, at least as it was visited on them by their teacher, was felt to be limiting their opportunities and knowledge potential. 

        Their teacher, Mrs Chandigarh, adopted a posture which they often felt assumed a power basis redolent more of assumption, and less of demonstrated or demonstrable advantage, and as such they were, on occasion, disinclined to comply what they considered were culturally insensitive demands made upon them.  For her part, she was known to have reservation about the potential of the boys to ever amount to anything in life, and it was widely believed she had taken offence at a series of ‘stink bombs’ which had added an agricultural aspect to the bouquet of her workplace,  amidst what she felt was disproportionate mirth in the classroom, early in her tenure at North Nutscratch, and wasn’t a woman to let bygones be bygones.

        So it was of no surprise to anyone when, one Thursday eve on a seat alongside the football ground after school, Ermo made a declaration.

        ‘I think being required to go to school tomorrow is a breach of my civil liberties.  Do you guys wanna go to the beach?’  he baldly posed.  ‘It’s gonna be hot – and the forecast is for a warm North Easterly.  Could be good surf,’ had added as a marketing and information campaign…….

  2. robert2013MEMBER

    It’s not the car that’s important it’s the skills we develop. Australia has some robotics and computer vision expertise, and should develop more. If a local car factory allows us to develop this, then good. Otherwise, we just become the pilot project for just in time local car manufacturing managed from the USA/Germany/Japan/China remotely. The self driving trucks on the mines in the Pilbara are an example of what we absolutely should not be doing, but what we always seem to do: import overseas tech wholesale with limited local skills development. Australia could and should be a world leader in unmanned air and water vehicles, both remote controlled and autonomous. IMO Autonomous weapons are now an inevitability. They are probably a greater threat to humanity than nukes, but they are also probably the only way for a smallish country like Australia to defend itself. We should be making them here.

  3. The cynic in me suggests that because our hapless politicians are involved, big corps will make out like bandits, and the Aussie taxpayer will get stiffed. We’ll probably need to import more “skilled workers” (plus their familes, their cousins, their dogs and a goat)to do the work as well.

    In other words, just another day in ‘Straya.

    • It’s harder to shaft people with manufacturing. Generally speaking it is the ‘best’ industry to give economic favours to as the benefits (such as economic multipliers) are greater than other industries. This is why developed countries like Germany and South Korea favour their manufacturing. At worst you end up employing a lot of people in high tech, high wage industry that boosts productivity and innovation. Compare that to fossil fuel subsidies to the mining sector…

      • Been a few articles around lately demonstrating with numbers that manufacturing (real production anyway) is the key thing that has gone missing causing the rising inequality. One article by David Stockman via ZH this morning
        https://www.zerohedge.com/news/2019-04-09/stockman-dalio-its-fed-stupid
        “There is only one way to explain the asymmetrical math. Self-evidently, the US economy on the margin has imported essentially 100% of growth in goods consumption since the pre-crisis peak.
        What comes to mind, therefore, is off-shoring and bad money. That is, the Fed kept the lower 60% of households that Dalio is worried about treading water with cheap mortgage debt, underwater car loans, unrepayable student debt and a tail-chasing rise of higher cost credit card finance.”

      • Ye of little faith. If you look at some of the spectacular own goals we’ve fired off recently, I believe we can do it. Straya!

  4. they should instead just give $5k or $10k subsidy for all electric cars made in Australia (assembled in Australia from at least xx% parts made in Australia)
    that way everything will be more transparent and harder to game

    • Strewth doc! The subsidy road has been tried long ago. Basically all a subsidy does is erode the position of other key export and import replacement industries. We need to have the A$ at a level where our external account is balanced – whatever that takes. Then proposals such as Ermo’s above would require little regulation and have real benefit and effect.
      The fundamental issue in this economy is the over-valuation of the A$ over such a long period that has led such massive misallocation of resources and distortion of the economy.

      • BTW The external account needs to run substantial surpluses for the next 60 years so we can buy our damned country back!
        It won’t happen of course – the answers lie back in time.

      • all countries subsidy electric cars, we should just fine tune that for domestic cars only – money should be given to buyers at the time of purchase

    • Jumping jack flash

      No, not subsidies. Tariffs.
      Subsidies cost you. Tariffs make money that can be reinvested into domestic manufacturing.

      • <Nope – that is only true if you think the government is the country.
        Tariffs help to maintain an overvalued dollar. So, especially if you take this long run, EVERY exporting and import competing industry pays for all the Tariffs. Nothiong is for nothing.

        Stop selling off the country to every damned foreigner that wants to buy it at the fastest possible pace. Stop borrowing funds from foreigners to spend on consumption or, for that matter, investment. Save and invest in productive enterprises. Take the A$ down.
        Yep it's too hard! Easier to have brain farts and let the whole damned burning cart keep careening towards its inevitable smash.

        Brain farts like applying tariffs to whatever special project a particular political party wants to make themselves look better is not going to progress anything.

  5. Billion dollar subsidies for foreign multinationals- who would have thunk it – only labor

    • Ronin8317MEMBER

      At least it would make something, as compared to the billion of dollars in subsidy for property investors.

    • Jumping jack flash

      Yes, it will fail if it is handed to the private sector in this current environment of extreme amounts of private nonproductive debt.

      It needs to be carefully managed by the government and they must have a controlling stake in it.
      This will require ministers who actually have a clue. They may need to import some because presently we got none.

  6. Pretty much sealed my vote for Labor (I have never voted Labor before).

    Keep in mind that it isn’t really about the viability of the car industry and its products directly – it’s about the periphery industries around it, which use the car industry as a baseload from which to generate cash, capital, R&D, innovation, etc, and benefit both the tech of the local economy, and export to the world…

    And, it’s better than a bloody defence-focused manufacturing sector, like the LNP have been talking about – I would much prefer cars over weapons (though I do understand there is a crossover…I just don’t want s to focus on grubby weapons)…

    My 2c

  7. Since when investing in yesterday’s industries (and a consolidated one at that) became a good idea?

      • We need airplanes, too, among other things.

        It is far better to invest in a niche industry in which we already hold an industry leading position or otherwise have a competitive edge.

    • Petrol car = yesterday’s industry
      Electric car = tomorrow’s industry
      The fact that electric cars are mechanically simpler than petrol cars makes it more viable to manufacture them in a country like Australia.

  8. Jumping jack flash

    Yes, yes, yesyesyesyes!

    And just like that, Labor completely redeems themselves! This is great news if it is real.

    • When a private sector in a high tech industry makes an investment decision it usually looks 20 years ahead: e.g., digital camera, smart phone, etc.

      If you start investing in what is already here today – what everyone with eyes can already see – it is guaranteed to end in failure. You will never catch up with the industry leader who had a head start long ago.

      Can Straya turn the tables against all odds? Nah, not likely.

      • Jumping jack flash

        It depends on what they do with it.

        It needs to be carefully managed in this environment of extreme amounts of nonproductive debt, a broken economy consisting of debt and gouging. Just plonking this money on the private sector would be disastrous. It would instantly disappear and be absorbed into debt and nothing would show for it.

        I’m sure India, Korea and China all had to start somewhere with their car industries too.

        I’m personally waiting for the space agency.
        Maybe my kids can work there.

      • Smart phones are built on decades of mostly government funded R&D that eventually led to the ability to commercialise that research and make smart phones. Industry didn’t suddenly decide “hey we should make a smartphone in 20 years”. They filled a market once they had the tools to make it and fill the need.

      • Smart phones are built on decades of mostly government funded R&D
        WHAT !!! like wtf are you talking about
        Do you have any idea how wrong this claim actually is.
        Would you like to explain to me (who might know a little about the subject) how Android and IoS were Government funded?
        What part of Smart Phone development was directly funded by governments, if so than which governments?Sure Nokia had huge plans and wanted lots of governments involved but last time I checked both Meego and Windows Phone were equally useless.
        Lets see there were other smart phones that had substantial government money invested Sony had something, but it died an early death,
        Like I said wtf are you talking about?

  9. “By 1990, no Australian child will be living in poverty”….hahahah….ganna be the same with this electric car stuff…

  10. Probably what we will end up with is something like an assembly plant from someone like BYD in Adelaide. Kind of like it was in Melbourne with overseas makers before the Second World War. We need to start from the bottom again and work our way up one step at a time…….not try to magic up a fully functioning industry out of the detritus of the last one.

    • Arthur Schopenhauer

      Every automotive brand is essentially an assembler of parts fed to it by a global supply chain. The Korean industrial conglomerates are the exception to the rule.

  11. There’s absolutely no reason for any major car manufacturer to ever return to our fair shores.
    and I mean absolutely no reason, however that said, there’s every reason for every car related manufacturing, design and even sales entity in this country to talk up their plans and apply for every dollar that’s offered to them (and some). This will turn into a pork barrel by which future pork barrels are measured.
    The only question in my mind is: Do I maintain the high moral ground and refuse to be involved OR get down and dirty with the rest of the pigs talking up the impossible….decisions decisions…why is it that Australian projects always seem structured to reward malfeasance? I wonder if it is somehow in our colonial DNA.

    • It was slaves who ate pork from a barrel. Pigs don’t eat pork (except in a Beatles song).

  12. Arthur Schopenhauer

    The idea is a good one, and with hard work, doable.

    At present, a regular combustion engine sedan has around 1900 sub-assemblies supplied by sub-contractors. The car companies integrate these components into a desirable whole, and wrap them in pressed steel sheet. There is a single global supplier of automotive sheet steel presses.

    A Tesla has ~600 sub-assembly suppliers, and mechanically, it is significantly less complicated to assemble. It’s a lot simpler to make electric cars, and it will become more so in the future.

    With the Chinese mandate on electric vehicles, every manufacturer is scrambling to go electric. This is the year to be recruiting car makers here.

    In a sense, Hockey has done us a favor. Being the last node in the industrial supply chain, I suspect Holden & Ford would have manufactured expensive, poorly designed ICE cars in AU forever and we would have been left well behind, again.

    Manufacturing also gives some balance against the miners & RE spruikers.

    This is a start to stopping our rapid slide into a cargo cult nation. I hope they pull it off.

  13. In his Budget reply speech, Mr Shorten said he wanted Australia to use its vast natural resources of lithium to create an Australian battery industry.

    “So instead of the usual trope of shipping the minerals overseas and buying back the finished product at vastly inflated prices, let’s make the batteries here,” he said.

    The ALP should absolutely fund a battery factory here – and ban foreigners from working in sub $100k/year jobs in the factory.

    But the prices are not vastly inflated. There is a lot of competition in the market and shipping is cheaper than ever.

    CEO of Brickworks is importing bricks. That is how cheap shipping is now.

    it costs twice as much to ship a brick from Perth to Sydney than one from Spain to Sydney. The Brickworks chief executive Lindsay Partridge says they’re importing a million bricks from Spain a month.

    https://www.abc.net.au/radio/programs/am/australian-brick-maker-imports-millions-of-spanish/7250090

    http://catallaxyfiles.com/2016/03/16/cheaper-to-import-bricks-from-spain/

    Raise the import tax on petrol cars to 20%. Petrol cars are evil.

    • “Raise the import tax on petrol cars to 20%. Petrol cars are evil”.
      Yep! We really need to give everyone who lives outside of the parasite big cities an even bigger ass ripping than we already have been giving them for 60 bloody years!!! Let’s really single them out to really pluck them over.

      • AUS has free trade agreements with Japan, Thailand, China, USA, etc.

        So it would be a 20% import tax on cars from Europe, India, Argentina (Amarok), etc. Up from the current 5%.

        Rural voters can keep buying Japanese cars. The import tax was 10% before.

  14. Nah! Retro all the way with a local rickshaw manufacturer. Shut the FN green cohort up. All able bodied migrant visa holders of all hues temporary visas, student visa, old fart relos-last can be performed by said importing relos. Minimum duration of 3 months extending to 5 years. Payable at present bus fare rates for occupants and only haulers paid. at min wage rate per week. Reduces immigration, pollution, increases the overall health of the stayers–the failures help the funeral industry. As visa holders all self insured for health access before arrival with an Aussie insurance company. Got a non rickshaw job in a non capital city here they come.