Tariff cuts to proceed

[vztrt]

Originally Posted by xtremerus

Shounak
The pot calling the kettle black there. To do your Economics Major, your education was subsidized/paid by the taxpayer. HECS doesn't cover all costs.
What is the difference in helping industries?

He's not feeding himself and his family from working in the automotive industry.

Originally Posted by SB076

After the second world war Japan was considered the place to manufacture goods on the cheap - it was cheaper than locally produced product but was commonly refered to as Jap crap. Today Japan is one of the most expensive places to manufacture goods. The cost of manufacturing goods in China will increase as their standard of living increases

China's on a different playing field. They keep their exchange rate artificially low and will not be hit by standard economics due to their oppression of the poor. They function on a truly 17th century level where currency controls prevent imports, but their devaluation always increases exports.

The flipside is that China is stockpiling huge reserves of a declining currency with no interest and will either feel the effects of inflation of an increasing interest rate soon.

China is on a different economic planet to the rest of the globe. If you could oppress your people, you might be able to emulate a China like situation.

Originally Posted by xtremerus

Shounak
The pot calling the kettle black there. To do your Economics Major, your education was subsidized/paid by the taxpayer. HECS doesn't cover all costs.
What is the difference in helping industries?

The difference is that I'm a bloody good investment. I'm going to pay back my investment in full (through my wages) and will return high amounts of tax for the government.

The subsidies given are not deferred loans, they're helicopter drops of money. If I was given $50,000 PA for nothing, I'd admit I was free riding.

But in actual fact, the government is investing in me because they know they'll reap dividends in the future.

Originally Posted by Barraxr8

What ??

How did you come up with that number ?

Explain and "flesh out" the reason for that dollar value please.............

I can't find the article, but it was an estimate based on all the costs Holden/GM outsource, rather than produce in Australia.

It has no material bearing on my argument that I can't find the stat because we know that domestically produced items are often many times more expensive than imported. Especially in the case of foreign owned/dominated markets.

If Australians could produce and build a $35,000 family car, you would see many more Australian car manufacturers. With all the subsidies they get, even a $70,000 car would probably reduce in price a great deal.

Tariffs are a bandaid for a bullet wound.

Originally Posted by SB076

No problem, but remember we are discussing tarrifs (not government spending - I assume you are talking about R&D which is a seperate topic all together and relates to all industry)

Australia isnt uncompetitive (ineffective) the conditions we operate under (many set by the government) need to be adhered to, but these come at a cost.

So you agree that the Aussie car market wont last without protection, therefore are you suggesting we abandon the market - or do you have another idea?

The conditions set by China might come back and bite them, but how - if we dont have any industry to compete in the future.

Australia is uncompetitive in the car market. We simply can't do it like the Asians do.

We don't have the quality of the Italians nor the efficiency of the Asians. It's a sad fact which will most likely kill the Australian car industry over time. Unless of course something is done.

Tariffs retard innovation. If Holden start feeling a hit, they may push their R+D more strongly and come up with something new. Ford invented the ute, the electric car's just around the corner.

I don't know why the F Ford/Holden aren't using diesel in the family cars. You could tow a boat with awesome economy. Just some ideas.

Holden/Ford should be at each others throats with Displacement of Demand etc. Cut of tarriff's would definitely increase competition. Mince you I'm not saying completely, but a reduction is warranted.

[vztrt]

Originally Posted by Shounak

Tariffs retard innovation. If Holden start feeling a hit, they may push their R+D more strongly and come up with something new. Ford invented the ute, the electric car's just around the corner.

Holden and Ford are not innovative, they AREN't allowed to use technology that hasn't been in the market for 10 years.

As for DOD thats like toyota's AWD when we feel like it.

Originally Posted by sleekism

Where is the evidence of "$140,000 Falcons".
If this is true than why as protectionism increased to it's heights with 85% local content and import quotas did the purchase price of cars continue to fall as apercentage of average income to about 40 weeks of average wages or a guesstimate of around $40,000 for a base Falcon in todays money?

Technological innovation. The cost of producing decreases over time. Plus, changes in capital influence a lot. Comparing points of time is often fruitless.

You are taking the comparitive advantage theory too literally and too simplistically. In a classroom it is easy enough to say "let us only manufacture what we are good at" but in the real world this is absolute stupidity ignoring the effect of exchange rates (a base model Falcon cost less than a base model Mazda 626 a decade ago) and the sheer logisticsand timeframe involved in turning the some 100,000 people, 100's of companies and tens of billions of dollars invested in local car manufacturing into what we have a comparative advantage in AT THIS TIME.

This is the most important consideration TIME. 3 years ago Ford was turning a healthy profit. 10 years ago an exported Camry or Commodore made a healthy profit. It could decades and countless billions to turn our automotive industry into a apparatus of the mining industry and givenpast history the minig boom will be well and truely over by then.

I'm not taking it too literally. The market is. I don't think that Aussie car manufactuers should stop completely. Just that they should align their actions more closely with their customers. It almost seems H/F don't act like an efficient business should.

We don't necesarily have to turn into the mining industry. Simply an industry which can better support itself.

Yes we might take away Aussie jobs. But so did the computer. Typewriters, screen setters, telegraph transcribers, etc all got displaced.

The advent of the digital watch destroyed horologists etc. Should we have just continued to subsidise these industries when other people had alternatives that could do it better?

You're probably thinking that I'm talking about technological innovation, not offshoring. But from a broader viewpoint, it's just another cheaper way of meeting the customers demand.

Tariffs are about insuring against "Dutch Disease" which is strangling our manufacturing sector. Would sale of local cars be so low if the Aussie dollar was back to 70 cents to a U.S. dollar?? What is going to happen when the mining boom ends and the price of imported goods increases?? Even before the mining boom ends we are going to face the appreciation in Chinese/Thai currency etc.

The key to economic success is MANUFACTURING.

Britain used to be the sweatshop of Spain.
Germany used to be the sweatshop of Britain.
Japan used to be the sweatshop of the United Sates.

Does anybody notice a pattern. All these nations started out as low cost supply nations for a wealthy country. They developed a manufacturing base devastated the host nations and as they developed they overtook the host nation economically.

China is the next example mark my words. They are stockpiling Coal, investing in renewable energy (thanks to the Three Gorges dam they will close half a dozen coal fired plants in the Chonqing region) and most importantly against free trade agreements they have kept their currency artificially low in order to be artificiall competitive.

One more point. Does anybody know that Australia was exporting Territoty's to Thailand for a time. When Australia signed a free-trade agreement with Thailand exports of Commodores and Territorys began to Thailand. Soon after however Thailand changed their tax laws effectively pricing our cars out of competition to protect their locally built.

So this is the level playing field?? Thailand exprots some 150,000 cars to Australia per year with NO TARRIF from a subsidised by the Thai Government industry while we are effectively banned from exporting to the Thai market.

Logic anyone??

If I'm taking comparative advantage too far. You're taking Mercantilism way too far.

The mobility of capital has negated the benefits of a production based economy. Your economic views were built on the assumption that the service sector was unproductive.

They didn't have words like human capital or information services back in those days. The mere thought of education as a commodity would have given them a coronary.

I know what China are doing and it will bite them. Just check my above post. With time, they'll feel the pinch and their case is unique.

About Thailand, if they're no worse off by stopping the purchase of Territories, then who cares? They were only buying our cars because they were better off doing so.

Imagine if we decided to stop the import of Japanese products. Or even if the USA did.

They wouldn't because they/we have a beneficial relationship, obviously Thailand didn't.

Originally Posted by vztrt

Holden and Ford are not innovative, they AREN't allowed to use technology that hasn't been in the market for 10 years.

As for DOD thats like toyota's AWD when we feel like it.

10 years?

I think there's a lot more H/F can do before they have to shut down shop. Lowering the tariffs will help that along.

My last post for the day is that this is fueled by Australian greed.

When our income increases, we spend more money, much of it overseas. That's what reduces our trade balance and makes other countries rich.

You can't stop globalisation. Barriers are being broken down and people are having to work harder for a larger amount of customers. Within a hundred years people will be laughing at tariff's, amazed they ever existed.

Other than being a costly way of propping up (potentially) uncompetitive workers in an uncompetitive industry in the short term, excessive tariffs are not good for the economy at large.

I think the car industry here has it way too cushy, as do the EU farmers. This only leads to unproductive practices that will harm Australians in the long run.

To really get back to topic, I support cuts to tariffs, not the immediate abolition.

[SB076]

Originally Posted by Shounak

I can't find the article, but it was an estimate based on all the costs Holden/GM outsource, rather than produce in Australia.

It has no material bearing on my argument that I can't find the stat because we know that domestically produced items are often many times more expensive than imported. Especially in the case of foreign owned/dominated markets.

If Australians could produce and build a $35,000 family car, you would see many more Australian car manufacturers. With all the subsidies they get, even a $70,000 car would probably reduce in price a great deal.

Tariffs are a bandaid for a bullet wound.

I would suggest that the article is incorrect, as for Australia producing a $35,000 family car that has been accomplished (Toyota Camry and 380 - we all know what happened to MMAL) Better a bandaid than nothing at all.

Originally Posted by Shounak

Australia is uncompetitive in the car market. We simply can't do it like the Asians do.

And why do you think that is? It wouldnt have anything to do with their working conditions or government legislation would it?? As others have said why is it that Asain Countries can effectively tax our exports but we cant do the same?

Originally Posted by Shounak

I know what China are doing and it will bite them. Just check my above post. With time, they'll feel the pinch and their case is unique.

About Thailand, if they're no worse off by stopping the purchase of Territories, then who cares?

We do, becasue we are worse off, less volume equals more cost, less volume equals greater amortisation costs of design development, crash tests you name it and ultimately increases the costs of our cars and reduces our workforce.

[Fordman1]

Originally Posted by Shounak

Tariffs are a bandaid for a bullet wound.

How about more facts and figures to back up the anti tariff argument re the automotive industry and less rhetoric ?

[SB076]

Originally Posted by Shounak

I think there's a lot more H/F can do before they have to shut down shop. Lowering the tariffs will help that along.

My last post for the day is that this is fueled by Australian greed.

When our income increases, we spend more money, much of it overseas. That's what reduces our trade balance and makes other countries rich.

You can't stop globalisation. Barriers are being broken down and people are having to work harder for a larger amount of customers. Within a hundred years people will be laughing at tariff's, amazed they ever existed.

Other than being a costly way of propping up (potentially) uncompetitive workers in an uncompetitive industry in the short term, excessive tariffs are not good for the economy at large.

I think the car industry here has it way too cushy, as do the EU farmers. This only leads to unproductive practices that will harm Australians in the long run.
snip

Holden and Ford wont just shut up shop they will move overseas with the loss of thousands of jobs - this will effect other industries financial industry, services industry, building industry, retail industry etc.

How has the car industry had it too cushy are you refering to the massive profits generated by Ford and Holden - or are you comparing them to their parent companies. The car industry is in difficulties however given a chance they can turn things around - you dont walk from an entire industry as it goes though a transitional phase this is when the industry needs protection.

I dont think the workers are uncompetitive I suggest you get out and have a look at the industry and see how things are done. If you know of unproductive practises please state the practises so the industry can improve and be competitive. Let us know what Ford, Holden and Toyota can do.

Tarrifs (or protection) should be offered to all industry especially considering other countries protect there industry - why should Oz be any different?

[Fordman1]

Originally Posted by Shounak

I think the car industry here has it way too cushy, as do the EU farmers. This only leads to unproductive practices that will harm Australians in the long run.

Bollocks !!

Get out of the lecture theatre, put down that study guide and spend 4 weeks with the manufacturing guys at Broadmeadows and Geelong.

You have no idea what those guys do and the way they run their business.

Try it, maybe you'll really LEARN something.

[sleekism]

Originally Posted by Shounak

Technological innovation. The cost of producing decreases over time. Plus, changes in capital influence a lot. Comparing points of time is often fruitless.



I'm not taking it too literally. The market is. I don't think that Aussie car manufactuers should stop completely. Just that they should align their actions more closely with their customers. It almost seems H/F don't act like an efficient business should.

We don't necesarily have to turn into the mining industry. Simply an industry which can better support itself.

Yes we might take away Aussie jobs. But so did the computer. Typewriters, screen setters, telegraph transcribers, etc all got displaced.

The advent of the digital watch destroyed horologists etc. Should we have just continued to subsidise these industries when other people had alternatives that could do it better?

You're probably thinking that I'm talking about technological innovation, not offshoring. But from a broader viewpoint, it's just another cheaper way of meeting the customers demand.



If I'm taking comparative advantage too far. You're taking Mercantilism way too far.

The mobility of capital has negated the benefits of a production based economy. Your economic views were built on the assumption that the service sector was unproductive.

They didn't have words like human capital or information services back in those days. The mere thought of education as a commodity would have given them a coronary.

I know what China are doing and it will bite them. Just check my above post. With time, they'll feel the pinch and their case is unique.

About Thailand, if they're no worse off by stopping the purchase of Territories, then who cares? They were only buying our cars because they were better off doing so.

Imagine if we decided to stop the import of Japanese products. Or even if the USA did.

They wouldn't because they/we have a beneficial relationship, obviously Thailand didn't.

You may be studying economics but I live in the real world of construction and engineering.

In the real world it doesn't make sense to throw away billions in investment and infastructure because of short term fluctuations in the market.

My work for example does Civil and Structural enginnering so as such employs Civil and Structural engineers. For the past year there has been very little Civil work and a boom in Structural work so as of such the Civil part of the business is unprofitable with the Structural part subsidising it.

Why doesn't the company simply fire all the Civil Engineers and concentrate on profitable structural work?? Because the market changes and next year there could be different conditions so there is no use throwing away all the investment.

Vehicle manufacturing is the same. It is currently unprofitable but 3 years ago it was and next year it could be. For all we know the Aussie Dollar could crash or Asian Currencies Skyrocket and manufacturing could be profitable again.

[Wretched]

Ok I found some info.
According to this link "...The taxpayer and consumer support to the industry was worth about $1.1billion last year. The PC reckons that each job 'saved' in the industry costs us $300,000 a year."

Here is the report link

http://www.pc.gov.au/__data/assets/p...omodelling.pdf

I am definitely seeing the evidence against tariffs stacking up.

[SB076]

Originally Posted by Wretched

Ok I found some info.
According to this link "...The taxpayer and consumer support to the industry was worth about $1.1billion last year. The PC reckons that each job 'saved' in the industry costs us $300,000 a year."

Here is the report link

http://www.pc.gov.au/__data/assets/p...omodelling.pdf

I am definitely seeing the evidence against tariffs stacking up.

Hmm have you read the article? By those figures only 3333 people are employed in the Automotive Industry. The so called expert advice comes from two former MMAL workers who were quick to request and accept grants from the government now they have changed their tune. Also interesting that the claimed $1.1 billion would consist of R&D which would be applicable to other industries (not just automotive) Interesting that the article stops short of providing the full story - doesnt show the taxes received by the government or even the economic benefits of providing tens of thousands of jobs (the automotive industry is far larger than those employed by directly by Ford, Holden and Toyota) The article also doesnt provide informaion as to what protection is offered to overseas manufacturers.

Edit: interesting the second article states that the direct number of employees involved in the Automotive industry is 68,000 (box 1.1 facts and figures) What do you suggest happens to those 68,000 workers should Ford, Holden and Toyota withdraw from manufacturing in Oz.

[xbgs351]

Originally Posted by Wretched

Ok I found some info.
According to this link "...The taxpayer and consumer support to the industry was worth about $1.1billion last year. The PC reckons that each job 'saved' in the industry costs us $300,000 a year."

Here is the report link

http://www.pc.gov.au/__data/assets/p...omodelling.pdf

I am definitely seeing the evidence against tariffs stacking up.

Mmmmm, $1,100,000,000 divided by 200,000 locally made cars => $5,500 per car.

Add 10% tarrif and a $40k Falcon has a $9500 cost advantage over it's imported rivals.

[Wretched]

Originally Posted by SB076

Hmm have you read the article? By those figures only 3333 people are employed in the Automotive Industry. The so called expert advice comes from two former MMAL workers who were quick to request and accept grants from the government now they have changed their tune. Also interesting that the claimed $1.1 billion would consist of R&D which would be applicable to other industries (not just automotive) Interesting that the article stops short of providing the full story - doesnt show the taxes received by the government or even the economic benefits of providing tens of thousands of jobs (the automotive industry is far larger than those employed by directly by Ford, Holden and Toyota) The article also doesnt provide informaion as to what protection is offered to overseas manufacturers.

No I haven't had a chance to read the whole report, it is after all 100+ pages and I am at work. Maybe tonight sometime I will get a chance to glance over it.

Look I see it from both sides. People against tariffs can't see the benefit of supporting manufacturers who are simply not competitive enough, that can't stand on their own two feet. They see the fact these multinational companies should be able to compete as others have, basically innovate or die.

On the other side people believe that the tariffs should be there to protect the industry, to keep people in work and keep what is left of the manufacturing industry for at least the short term.

Me? I am about facts and figures, evidence to prove one way or the other. I am not an economist (far from it) but am keeping my personal opinion out of it. I would rather the decision to be made to benefit the country not a select few people.

[Fordman1]

Originally Posted by xbgs351

Mmmmm, $1,100,000,000 divided by 200,000 locally made cars => $5,500 per car.

Add 10% tarrif and a $40k Falcon has a $9500 cost advantage over it's imported rivals.

Good point xbgs351 - now we're getting to the bottom of it.

In reality more than 200,000 cars are made locally I think (exports should be included too).


The number may be around :

70,000 Ford.

120,000 Holden (inc exports).
140,000 Toyota (inc exports).

30,000 Mitsubishi (now gone).

Does 360,000 sound about right ?

So........ that's around about $ 3,000 per car now.

How is a "Falcadore" going to cost $140,000 without govenment help ??? :togo:

[SB076]

Originally Posted by Wretched

No I haven't had a chance to read the whole report, it is after all 100+ pages and I am at work. Maybe tonight sometime I will get a chance to glance over it.

Look I see it from both sides. People against tariffs can't see the benefit of supporting manufacturers who are simply not competitive enough, that can't stand on their own two feet. They see the fact these multinational companies should be able to compete as others have, basically innovate or die.

On the other side people believe that the tariffs should be there to protect the industry, to keep people in work and keep what is left of the manufacturing industry for at least the short term.

Me? I am about facts and figures, evidence to prove one way or the other. I am not an economist (far from it) but am keeping my personal opinion out of it. I would rather the decision to be made to benefit the country not a select few people.

The figures provided by the Australian (your first link) IMO are wrong. There are reasons why we are not competitive (as discussed previously which have more to do with government legislation than anything else - are you aware that China offers an export rebate to its manufacturers - this previously was 20% not sure what it is at the moment as I beleive they may be adjusting it)

I beleive its in the best interests of Oz to keep manufacturing - as stated 68,000 people involved in Automotive - who knows how many in manufacturing in general, but even losing those 68,000 would result in massive job losses in other industries

[SB076]

Originally Posted by Barraxr8

Good point xbgs351 - now we're getting to the bottom of it.

In reality more than 200,000 cars are made locally I think (exports should be included too).


The number may be around :

70,000 Ford.

120,000 Holden (inc exports).
140,000 Toyota (inc exports).

30,000 Mitsubishi (now gone).

Does 360,000 sound about right ?

So........ that's around about $ 3,000 per car now.

How is a "Falcadore" going to cost $140,000 without govenment help ??? :togo:

Last year around 330,000 cars were made in Aus, years before that up to 400,000. Oz has been making over 300,000 cars a year for more than the last 10 years - source productivity commision that wretched posted

[Wretched]

Originally Posted by SB076

The figures provided by the Australian (your first link) IMO are wrong. There are reasons why we are not competitive (as discussed previously which have more to do with government legislation than anything else - are you aware that China offers an export rebate to its manufacturers - this previously was 20% not sure what it is at the moment as I beleive they may be adjusting it)

I beleive its in the best interests of Oz to keep manufacturing - as stated 68,000 people involved in Automotive - who knows how many in manufacturing in general, but even losing those 68,000 would result in massive job losses in other industries

Ok that's your opinion and i won't object to you having it, but I will put that to one side with everyone else's unless of course you have a referenced link/document to backup your opinion or disprove the figures in the article?

EDIT:
So what are Ford doing to survive here? Where is their export program?
Why wasn't the FG engineered for LHD? NZ and SA are their only exports but to keep the manufacturing here with reduced tariffs they need to be serious, quit the whining and get a proper export program happening, innovate.

[Fordman1]

Originally Posted by SB076

Last year around 330,000 cars were made in Aus, years before that up to 400,000. Oz has been making over 300,000 cars a year for more than the last 10 years - source productivity commision that wretched posted

Thanks.

[SB076]

Originally Posted by Wretched

Ok that's your opinion and i won't object to you having it, but I will put that to one side with everyone else's unless of course you have a referenced link/document to backup your opinion or disprove the figures in the article?

1,100,000,000 ($1.1 billion) / $300,000 = 3666 people involved in the automotive compared to
1,100,000,000 / 68,000 no of people involved according to PC = $16,176

This does not take into account the benefits gained from the automotive industry such as taxes etc.

Edit: I am not whining, nor do I think Ford are and I hope they do develop an export program (maybe you can suggest some countries, US? Thailand? they all offer various measures of protection) I do find it interesting that there are a lot of arm chair experts (and pollies) who have no idea on manufacturing what so ever, but can state that Australia is simply uncompetitive without looking at the reasons why. I am concerned with the long term ramifications of these decisions and hope people can realise the the loss of manufacturing or any industry in Aus will have flow on effects to other industries.

[sleekism]

Originally Posted by SB076

1,100,000,000 ($1.1 billion) / $300,000 = 3666 people involved in the automotive compared to
1,100,000,000 / 68,000 no of people involved according to PC = $16,176

This does not take into account the benefits gained from the automotive industry such as taxes etc.

Edit: I am not whining, nor do I think Ford are and I hope they do develop an export program (maybe you can suggest some countries, US? Thailand? they all offer various measures of protection) I do find it interesting that there are a lot of arm chair experts (and pollies) who have no idea on manufacturing what so ever, but can state that Australia is simply uncompetitive without looking at the reasons why. I am concerned with the long term ramifications of these decisions and hope people can realise the the loss of manufacturing or any industry in Aus will have flow on effects to other industries.

If anybody read a recent edition of wheels the so called "handouts" aren't really as such. They are not in cash they are in fact in the form of import "credits" whereby manufacturers get a discount on tariffs on imported vehicles from their own brand. It also goes on to say that if you that the tax paid by the locals is in fact greater than the Government subsidies so technically they aren't subsidised.

If someone wants to read a good book on how to "compete" with Japanese manufacturers than I suggest the book "automobile factory of despair"

http://blog.autospeed.com/2008/04/11...ry-of-despair/

Here is an extract:

He describes the tasks he has to do at his station:

1. I pick up two knock pins (small pieces of steel shaft) with my left hand from a parts box (where identical parts are stored) in front of the assembly line. I insert them into the upper holes on a gear box and then knock them in with the hammer in my right hand.

2. With my right hand, I take an input shaft out of a tin box coming down the assembly line. I insert it into the center hole of the gear box. Holding the input shaft from the other side with my left hand, I drive it in with the hammer. (Sometimes it doesn’t go in easily.)

3. With my left hand, I screw a synchronizing ring to an end into which an input shaft has been driven.

4. I turn the gear box around.

5. With my left hand, I take out a reverse idler gear from the tin box. I put it into the gear box and press it with my hand. With my right hand I take a shaft out of the parts box and insert it into a hole on the opposite side of the gear box. I insert the shaft through the idler hole and then fit it into the gear box. With my right hand I pick up a small semicircular pin (it’s hard with gloves on) and force it into a slot on the shaft to connect it to the gear box. (The pointed end of the shaft doesn’t always go smoothly into the hole in the gear box.)

6. The line brings an output shaft (which has many gears) placed upright in a hole in the gear box. I lift it with both hands and place it horizontally into the gear box. Then I connect it to the input shaft that I put in previously and fix them in their correct position in a slot so that they rotate freely.

7. With my left hand I reach over to a box on the other side of the line to get a molded metal fork. With my right hand I take a hub out of the tin box. I connect the parts at two places, using two clips that I’ve picked up with my right hand (very difficult with gloves on!).

8. With my left hand I pick up a bearing lock from the tin box. Then I turn around. I place the bear¬ing lock on top of a line mount. I pick up a rubber oil seal and put it into a hole in the bearing lock. Pressing the oil seal with a cold-chisel-shaped stick in my left hand, I hammer the oil seal in. (If I bend the oil seal, the transmission will leak oil.)

9. After hammering the oil seal in, I take out a paper gasket that’s hanging down in front of my eyes. I soak it in liquid bond and then apply it to the rim of the bearing lock.

10. I turn around again and face the line and put the bearing lock on it. I grab the hammer and start doing step 1 again. In all, I assemble fifteen big and small parts.

And what time is given to complete these tasks? - 78 seconds! Over the course of one shift, more than 300 gearboxes are made – a number that increases as the book progresses and the line is speeded up still further.

[RATT]

Originally Posted by Dave_au

Hahaha - Have a look at the prices of cars in the United States (excluding some state taxes) to understand just how much we get shafted:

Lexus IS250 for around USD$40,000/AUD$45,000 (here 58k-75k)
BMW M3 USD$58,000/AUD$66,000 (here $130k)
BMW M5 USD$83,900/AUD$92,000 (here $240k)

It's all about volume and distance to a lesser extent.
Much higher volume in the US compared to here and therefore lower cost of sale.

Originally Posted by Barraxr8

How about more facts and figures to back up the anti tariff argument re the automotive industry and less rhetoric ?

If it counts towards my international economics marks, then certainly. But I cbf.

If you were an electrician, it's like me asking you to install some more power points in my house for free, just so you can prove you know your stuff.

I'll do it for the right incentives. Not much chance of it happening unless you guys all pool your resources for my answers.

Originally Posted by SB076

I would suggest that the article is incorrect, as for Australia producing a $35,000 family car that has been accomplished (Toyota Camry and 380 - we all know what happened to MMAL) Better a bandaid than nothing at all.

And why do you think that is? It wouldnt have anything to do with their working conditions or government legislation would it?? As others have said why is it that Asain Countries can effectively tax our exports but we cant do the same?

We do, becasue we are worse off, less volume equals more cost, less volume equals greater amortisation costs of design development, crash tests you name it and ultimately increases the costs of our cars and reduces our workforce.

A $35g Aussie car hasn't been established. Those are just heavily subsidised Japanese companies.

I doubt Holden could produce a decent car for $35g without tariffs.

Retaliatory tariffs are not the solution. People would only buy our cars because they're better off as a result.

If they think they'll be better off not buying our cars, then that's their decision. You don't have your butcher twisting your arm to buy his meats because he's better off than if you bought it from Coles.

You'd only buy for him if he did the same/better quality for cheaper/same.

Originally Posted by Barraxr8

Bollocks !!

Get out of the lecture theatre, put down that study guide and spend 4 weeks with the manufacturing guys at Broadmeadows and Geelong.

You have no idea what those guys do and the way they run their business.

Try it, maybe you'll really LEARN something.

I couldn't care less about their practices. If they can build a car that would sell in the worldwide marketplace and sustain their business, good on em.

That's all that matters. If the only way they can stay in business is from govt handouts, then certain questions need to be asked about their sustainability.

I am definitely under the impression that if handouts were decreased, these companies would be forced to innovate.

Originally Posted by SB076

Holden and Ford wont just shut up shop they will move overseas with the loss of thousands of jobs - this will effect other industries financial industry, services industry, building industry, retail industry etc.

How has the car industry had it too cushy are you refering to the massive profits generated by Ford and Holden - or are you comparing them to their parent companies. The car industry is in difficulties however given a chance they can turn things around - you dont walk from an entire industry as it goes though a transitional phase this is when the industry needs protection.

I dont think the workers are uncompetitive I suggest you get out and have a look at the industry and see how things are done. If you know of unproductive practises please state the practises so the industry can improve and be competitive. Let us know what Ford, Holden and Toyota can do.

Tarrifs (or protection) should be offered to all industry especially considering other countries protect there industry - why should Oz be any different?

I think the level of protection given is too high. Like said before, I don't support the abolition of tariffs, merely a cut.

If it's just short term protection you talk about, then the tariffs they get should see them through just fine. But its when manufacturers build tariff/protection revenue into their business plans, that the problems start.

If H/F can produce a car that will sell in the worldwide marketplace, then good for them. Hopefully they can do so without subsidies.

I've got no doubt that they're probably more productive per worker than their Chinese counterparts, but the fact is that the Asians can often do the same work for less.

That's why MG Rover was moved to China. There's only so much protection you can give to an industry.

I would hugely disagree that tariffs should be given to all industries, for a number of reasons. Even the most Economically liberal people wouldn't support that.

Again, time is money and I don't have the time to write out a mini essay everyday.

I simply believe that Australian car manufacturers need to be able to compete in the global marketplace with minimal protection. By gradually cutting protection, they are going to be forced to innovate more (more on the R+D, marketing side rather than the production side possibly).

So just to recapitulate, tariff's should not be abolished. They should be cut in a manner that fosters the growth of companies to allow them to compete on a global level. Protection has been shown to limit this and limit production decisions.

I think you guys are seeing my views as much more extreme than they actually are. In an ideal world I would advocate much different things to what I am here.

[Fordman1]

Originally Posted by Shounak

I couldn't care less about their practices.

I am definitely under the impression that if handouts were decreased, these companies would be forced to innovate.

Don't care ? Obviously not, because you have no idea what goes on behind the front gates of those businesses. It's easy to rattle off numbers like $140,000 and make statements about 'efficiencies' or "lack there of".

Australian manufacturers innovate now, but don't let that get in the way of a good story. Innovation has had to happen in these plants, that's where the battle is ultimately going to be won or lost.

Design for manufacture, flexible cells, quick changeover, these are all part of Ford's manufacturing systems. Unfortunately the capital investment is so intensive in Automotive manufacturing business plans that fast & large changes across all systems is impossible - it is often linked to platform changes or new programs. Toyota and Holden have their systems that promote continuous improvement as does Ford.

FoA, for example, have one of the most lean and flexible stamping and assembly plants in the world. Visit the Broadmeadows Bodyshop. If that's not good enough, visit it when they add another platform (Focus) in a couple of years and tell me that they aren't innovative.

The Australian manufacturers are light years ahead of where they were 20 years ago both in cost and quality. This has been been driven by the reduction in Tariffs, no doubt, but to call the current plants inefficient and insinuating that they do not innovate is unfair.

Like I said earlier, "Get out into the real world" and learn something for yourself. If you did maybe you'd end up with something called business acumen.

BTW your international economics 'marks' mean "diddley squat" in the real world until you've earned your 'stripes'.

Start off doing some photo-copying then move onto doing a few "pie-charts" for your new boss for starters. Then again, I guess from reading your post above (about the value of your knowledge) you'll be moving straight on to running the OECD instead.