Car Industry

A mate of mine went on a family holiday to China in January. He relayed an interesting item from a local English language newspaper about a new pay deal which had been struck for manufacturing workers in Macau. Under the deal, the workers will be paid AUD $239. Not $239 a day. Not $239 a week. But $239 a month.

Factoids such as this are illustrative, and depressingly so, as countries such as Australia grapple with the future of manufacturing jobs. The current discussion about the future of the car industry has been complicated by the high Australian dollar, which is driving up the cost of everything we export.

Regardless of whether our dollar was at 70 cents or at parity with the greenback we would still be wrestling with the exact same problems of competition amid the unstoppable forces of globalisation.

Continue reading "Propping up car jobs won’t save them in the long run" »

The announcement by Toyota of several hundred job losses this week is certainly alarming and it will have had and will continue to have ramifications for the broader industry.

But it will only mark the end of the industry if we as a society say we don’t want manufacturing and we are happy to simply be China’s quarry and maybe a second tier tourist destination.

In all the hyperbole and wild statements we hear about our mining industry, we rarely hear some of the uncomfortable truths. That it’s only 9 per cent of the economy, that it is the cause of the high Australian dollar which is putting pressure on our manufacturers and farmers, and that, at its best, it really only represents the highest aspirations of the average third world dictator.

Continue reading "A bloody good reason to subsidise car making" »

Australian governments have a long history of offering taxpayers’ money to private businesses in an effort to get them to come or stay. Liberal and Country League Premier Tom Playford elevated it to an art form after 1945 when he set out to build an industrial and manufacturing base in South Australia. Tax holidays, grants, cheap land, incentives, and cheap public housing for the industrial workforces through the Housing Trust.

In fact, the use of public money to convince car-makers goes back even further. My attention was drawn to a question asked in the South Australian Legislative Council on 14 August 1935. The LCL government was asked “what steps has the government taken to encourage General Motors Holdens Limited to remain in South Australia?” The answer: “The government is much concerned about the possibility of losing that industry and is doing everything possible to retain it”.

That question and answer could describe the current decision-making process concerning both GMH and Ford. The Federal, Victorian and South Australian governments are embroiled in trying to work out just how much taxpayer money will be needed to keep both functioning in Australia.

Continue reading "Is it really worth propping up the ailing car industry?" »

It’s the third week of January and we’re facing a long year in politics. With no federal election due until 2013 we could be in for a 12-month bout of deja vu, as ALP leadership speculation rumbles on, people keep giving Tony Abbott lots of free advice (because 54/46 two-party preferred is not impressive enough polling), and boatloads of asylum seekers keep setting off from Java.

So nothing’s changed. Well, that would be too easy. Actually, as 2012 dawns the political landscape has become a bit skewwhiff.

Robert Manne started it all just before Christmas, when he wrote a piece in The Monthly admitting what a lot of lefties had already started to think, but hadn’t yet been game to say - that while they hated John Howard’s Pacific Solution, it did, indeed, stop the boats. And with no boats there were no drownings, and upon reflection, that was a pretty good result.

Continue reading "Whose side are you on? An upside-down start to 2012" »

UPDATE 7.35pm: Kevin Rudd has called an Auditor-General’s inquiry into the affair, but is standing by his denials that neither he nor his office has made any representations on behalf of car dealer John Grant, and is continuing a full email search through the Department of Prime Minister and Cabinet. Follow the news links below for more.

KEVIN Rudd has a whole stack of explaining to do.

His claim that he has done nothing wrong in relation to his car dealer mate John Grant has now officially conked out, and is up on the blocks looking like very much like he sold the Australian people a lemon.

As a result of this afternoon’s estimates hearings it now appears he has seriously misled Parliament over his relationship with his friend and neighbour, who runs a Kia dealership, and who famously lent him a ute as an electorate vehicle. At its worst, it appears the Prime Minister’s office - and possibly even the PM - directly interfered on behalf of the PM’s little car-dealing mate to make sure he got a slice of the federal bailout money for the ailing car industry.

Continue reading "PM’s car trouble more than just a minor bingle" »