Engineers call for new Australian auto policy

[Road_Warrior]

What a shame it has taken something as significant as Ford announcing its factory closures for people to start coming out and stating the bleeding obvious.

http://www.goauto.com.au/mellor/mell...257B830021072F

More robots and regions needed for Australian automotive industry

7 June 2013

By IAN PORTER

AUSTRALIAN car-makers and parts suppliers need to embrace more technology and consider fewer human workers, says a leading automotive engineer

At the same time, the government’s future automotive industry policy needs to incentivise local companies to expand beyond our borders into regional markets.

“We have to learn from overseas. How do other countries do it that have high wages, that have other high costs, that don’t have natural resources?” says president of the Society of Automotive Engineers-Australasia Bill Malkoutzis.

“There needs to be a holistic approach by the government that addresses the overall industry, not just individual manufacturers and importers.”

Mr Malkoutzis was speaking in an address to the society’s annual meeting last week.

“The Australian industry needs a low labor input, possibly robots with supporting technicians, and building in volumes high enough to amortise the high cost of technical content so it competes with low Asian labor rates,” he said.

“There will also be a need for detailed policies to ensure a true level playing field is achieved to open the markets that are currently closed to Australian manufacturers.”

General NewsParts center imageLeft: President of the Society of Automotive Engineers-Australasia Bill Malkoutzis.

He said Australia needed to go back to the approach the late Senator John Button adopted when he drew up what became known as the Button Plan.

Mr Malkoutzis said the Button Plan was designed specifically for the Australian industry, addressing it weaknesses and building on its strengths.

“But that plan is 30 years old now,” he said. “We need another one of those where we seriously look at what makes the industry work right now, how other people are surviving, and adapt to that.

“Then the government can spend its money in a very effective, pointed way to facilitate that (success) in our own country.”

As for high-cost industries, Mr Malkoutzis said he had toured the Volkswagen plant at Wolfsburg.

“They build half a million Golfs a year in that plant. How do they do that with German wages?

“There is a whole underground plant that builds the bodies and paints them underground. How many technicians do they have in that area? At one point it was only 16.

“Upstairs there were staff putting the components on, with a lot of smart assembly equipment, and there was a material control management system up in the roof that presented parts at the right time.

“It took lots of money, technology, tooling, technicians left right and centre and few people actually putting the thing together. They spat a Golf out every six seconds,” he said.

He said the way to achieve significant volumes in Australia was for the government to strike deals with the manufacturers so they could become regional suppliers.

“The Government has to go to these companies and say we’d like to make you a regional manufacturer, what is it going to take to do it, to make you profitable and to sell in volume? We struggle with that.”

He concedes that this approach means Australian policy has to make Australia more attractive to the car-makers than Thailand, say, at least for some vehicles or products.

“It might be through specific grants or tax deduction benefits, like for tooling. Instead of 10 years, let them write it off in two years. That’s only one example.”

However, Mr Malkoutzis also singled out market access as a necessary part of any new plan, and that meant taking a harder line in free trade agreement negotiations.

“The government has to look at agreements it is about to sign more carefully to ensure that they are real, open free trade arrangements.”

He said Australia should not allow itself to be tricked again, as it was by Thailand after the two countries signed another lop-sided FTA which stripped away all of Australia’s automotive tariffs for Thai exports but left tariffs in place in Thailand against Australian exports.

After that deal was signed, the Thai government then raised the sales tax on vehicles with engine capacities above 3.0-litres to 100 per cent, to make doubly sure Australia could never export to Thailand.

Mr Malkoutzis also has a plan to cope with the carbon tax and its effect – which Toyota says is around $115 per car – on Australian industry.

“The carbon tax is fine by me, as long as every car that gets shipped in from overseas that does not pay a carbon tax gets equalized when it gets here,” he said.

They should also pay a carbon tax on the energy used to ship the vehicles to Australia.

“Every imported car should pay its fair share of carbon tax, then everyone is on the same playing field.”

We should have had this conversation 3 years ago. Is it too little too late? I like this guy's thinking, but expecting someone like Ford to stump up cash to install robots in a plant they clearly wanted gone years ago was/is never going to happen. And as for reversing some of the content of FTA's...I doubt that will happen either.

That Golf assembly plant sounds interesting though.

[InfernoSR]

Increase the taxes on imports, and help the locals... sounds simple, and yet our governments for the last however many decades just cannot see this...

[borough]

Originally Posted by InfernoSR

Increase the taxes on imports, and help the locals... sounds simple, and yet our governments for the last however many decades just cannot see this...

Increasing taxes on the imports would have the same effect as closing the gate after the horse has bolted. May as well just give up and stop supporting the car industry and find something else this country can do. I hear we are very good at digging up dirt and sending it overseas.

[BHDOGS]

I can see the headline now "Ford leaving saves holden" the ultimate self sacrifice another victory for ford all hail the great and power ford now lets say 30 hail fords. And pass the collection plate for holden

[Lotte]

Bill is switched on. Don't know him myself, but I know people who work for SAE.
Better late than never I suppose. Fingers crossed it filters into Ford reconsidering staying/gov co convincing them to stay/some other scenario where they don't leave.

[ebxr8240]

As in before the financial crisis.. Ford was one of the FIRST to do something about its position !!
Could be what's going on here?? After all I doubt Holden is going to make money selling cars people don't want in masses..If they can import much cheaper then there's every chance they'll do ok..Governments the last 30 years don't care about local industry..

[mik]

Its a nice idea he has, but theres about 4 times as many germans to buy golfs locally than there is here, and I wonder if the germans have a fair trade agreement that shoots their industry in the foot?? As for robots my bet is they cost a packet to implement and a lot in energy to run.

[Moby Vic]

All hail robots!

[M&Ms]

Population keeps growing, yet technology and globalisation causes us to rely less and less on physical human input. When will it all end!! Are we all going to become beggers on the street one day, or slaves for the top 2% of society???

[rdmr]

We have a FTA with Thailand that is CLEARLY, PLANLY and OBVIOUSLY destroying an Australian industry and costing thousands of jobs and with it throwing many lives into turmoil.
And what is the Australian government doing?
******* nothing!
Sickens me beyond words.

[2011G6E]

Originally Posted by InfernoSR

Increase the taxes on imports, and help the locals... sounds simple, and yet our governments for the last however many decades just cannot see this...

Ah yes, the golden days before the Button Plan...bring 'em back I say! Then we can go back to shoddily built lazily designed local cars because the makers know that they will always be protected by the government from the big bad world outside our borders...selling whatever dreck they dish out to a captive audience who doesn't know any better.

Except now the audience does know better...they know what they've been missing out on. I imagine some of you would be old enough to remember the seventies and the first time you either bought or went for a ride in a friends or family members "funny foreign car", and been amazed at the standard features...disc brakes, AM/FM stereo, rear window demister, air conditioning, cloth interiors...they seem simple things now, but back then they were options on Australian cars, and the cheap stuff that people bought just didn't have what foreign cars had as standard. The makers here didn't have to try harder, as they assumed they would always be protected by tariffs and taxes.
Sometimes...even today with the FG when compared to overseas cars...the foreign competition has features that simply don't exist in our home grown big sedans.

Strongly protecting our industry to force people to buy Australian cars like "the good old days"...?

Be careful what you wish for..

[pottery beige]

Originally Posted by 2011G6E

Ah yes, the golden days before the Button Plan...bring 'em back I say! Then we can go back to shoddily built lazily designed local cars because the makers know that they will always be protected by the government from the big bad world outside our borders...selling whatever dreck they dish out to a captive audience who doesn't know any better.

Except now the audience does know better...they know what they've been missing out on. I imagine some of you would be old enough to remember the seventies and the first time you either bought or went for a ride in a friends or family members "funny foreign car", and been amazed at the standard features...disc brakes, AM/FM stereo, rear window demister, air conditioning, cloth interiors...they seem simple things now, but back then they were options on Australian cars, and the cheap stuff that people bought just didn't have what foreign cars had as standard. The makers here didn't have to try harder, as they assumed they would always be protected by tariffs and taxes.
Sometimes...even today with the FG when compared to overseas cars...the foreign competition has features that simply don't exist in our home grown big sedans.

Strongly protecting our industry to force people to buy Australian cars like "the good old days"...?

Be careful what you wish for..

blaa blaa blaa.. the same regurgitated crap......

what you are obviously blind too see the button plan was not dynamic and allow for changes on the world manuf scene...

bye bye aus manuf...

[mik]

Originally Posted by 2011G6E

Ah yes, the golden days before the Button Plan...bring 'em back I say! Then we can go back to shoddily built lazily designed local cars because the makers know that they will always be protected by the government from the big bad world outside our borders...selling whatever dreck they dish out to a captive audience who doesn't know any better.

Except now the audience does know better...they know what they've been missing out on. I imagine some of you would be old enough to remember the seventies and the first time you either bought or went for a ride in a friends or family members "funny foreign car", and been amazed at the standard features...disc brakes, AM/FM stereo, rear window demister, air conditioning, cloth interiors...they seem simple things now, but back then they were options on Australian cars, and the cheap stuff that people bought just didn't have what foreign cars had as standard. The makers here didn't have to try harder, as they assumed they would always be protected by tariffs and taxes.
Sometimes...even today with the FG when compared to overseas cars...the foreign competition has features that simply don't exist in our home grown big sedans.

Strongly protecting our industry to force people to buy Australian cars like "the good old days"...?

Be careful what you wish for..

Mate........... those days are gone, our manufacturing is almost in the toilet, and your still banging on about us being overly protected, no one wants to give them a free ride, just give our industry fair go.

[2011G6E]

A clever businessman...one who runs a long lasting and profitable organisation that is...can face up to reality and realise there are some things he just can't do himself, so he will do one of two things: employ someone to develop and do it for him, or if that isn't cost effective, hire some outside firm to do efficiently it for him at a substantially lower cost.

No real difference between a business and running a country. If we can't effectively and cheaply make the cars the customer obviously wants, then we can do as other small countries do and pick and choose the best from around the world to supply our needs.

Playing on tradition or feeling the need to keep propping up an industry that honestly there is nothing magical about having in your country (making your own cars) doesn't face reality.

[UberKnee]

Originally Posted by mik

Mate........... those days are gone, our manufacturing is almost in the toilet, and your still banging on about us being overly protected, no one wants to give them a free ride, just give our industry fair go.

But people are calling for/wishing that the government had built a figurative wall around Australia and not allowed any imports in, in the first place. A captive market is easy to please...

[mik]

2011g6e not only do we lose car makers, we lose value in technology developed here, we lose employment across the board, we become more dependant upon other countries for goods we can and should be making here , and apart from every thing else, it is wrong on principle to throw our own industry away due to poor trading deals that benefit countries other than our own.
as for the being clever thing i`m betting if we had a real clever and honest fair trade deal between countries our car industries would be kicking on without needing handouts.


Uberknee, i don't think that is the general consensus at all, i think the general consensus is that most just want a fair trading deal....as it should be.

[jpd80]

Bottom line, our Australian auto manufacturing industry has been thrown under a bus because
people want cheap imported vehicles and don't want to support Australian made anymore..

That was in essence the effect of the Button Plan and elimination of Tariffs, Ford and Holden
were mortally wounded years ago, it's just that we never realised it until now...

[2011G6E]

Originally Posted by UberKnee

But people are calling for/wishing that the government had built a figurative wall around Australia and not allowed any imports in, in the first place. A captive market is easy to please...

...and easy to fool into thinking whatever they are getting dished out to them is "worlds best...trust us!"...as I said, they know now what they would be missing out on if we put up the walls and kept imports out or taxed them into oblivion. A true (automotive) case of "How you gonna keep 'em down on the farm, now that they've seen Paree".

As I said, go back to the seventies when protectionism of the local car industry was high...our neighbour, a Holden man through and through, had just bought his latest Kingswood wagon, a V8 Vacationer. My old man within a week of this bought our latest car, a Mazda 929 wagon, top of the line. The 929 had air con, a floor shift four speed, and AM/FM radio cassette fitted from the factory with four, count 'em four speakers (and the aerial concealed in the windscreen glass!), and window tinting amongst other standard fittings.
The neighbour had his faith badly shaken when he took my old mans car for a drive...he was seriously wondering if his next car would be a Holden at all.

Britain went through it with their car industry, yet their industry, after chopping out all the dead wood and getting rid of makes that just couldn't keep up with modern times, is better than ever.
Our car makers need to sit down and take a good long hard look at themselves and more importantly what they're competing against and what the public wants, and don't just keep trying to rely on selling cars the old fashioned way which doesn't work anymore: that being multi-generational badge-blind buyers who will just unquestioningly and automatically trundle down every couple of years and buy a Holden/Falcon just because daddy had one and his daddy had one.

[tezxr8man]

Originally Posted by borough

Increasing taxes on the imports would have the same effect as closing the gate after the horse has bolted. May as well just give up and stop supporting the car industry and find something else this country can do. I hear we are very good at digging up dirt and sending it overseas.

REALLY?? That's a bit defeatist isn't it, if that's the view maybe we should just put a bullet in our heads now because we are going to die eventually

Nothing is over til it's over and times and/or decisions change every day just like they have in the past

Maybe this is the wake up call the brain dead pollies needed to change the situation for the better

[pottery beige]

there is a big difference between open market fair and reciprocal trade agreements and being an automotive dumping ground........

[jpd80]

Originally Posted by pottery beige

there is a big difference between open market fair and reciprocal trade agreements and being an automotive dumping ground........

It's a tricky one but the balance of trade between Australia, Japan and Korea is heavily in our favor.

Thailand is a joke, the place is set up to be an export nation with zero intent of importing anything from Australia.

[mik]

Originally Posted by jpd80

It's a tricky one but the balance of trade between Australia, Japan and Korea is heavily in our favor.

Thailand is a joke, the place is set up to be an export nation with zero intent of importing anything from Australia.

you might be right, but it doesn't seem that way, and what about the rest of the world ???

[UberKnee]

Originally Posted by mik

you might be right, but it doesn't seem that way, and what about the rest of the world ???

Just seems like a case of grass is always greener on the other side; Australia isn't 'flooded' by different car makes anymore than any other country. Manufacturers/models that only build LHD are unavailable here outside of select importers and then they cost 2 or 3 times more than they're worth/would sell for her otherwise.

A basic Mercedes/BMW/Audi/etc. that sells for peanuts everywhere else is a $100k+ here which keeps it out of most peoples reach.

Overall the biggest sellers here are generally Ford/GM/Toyota/Nissan/Mazda with everyone else selling in small volume.

So local manufactures still have plenty of opportunity, you look at America where typically Pontiac/Chevy/Ford/Dodge/BMW/Mercedes/Jaguar and several others are all the big volume players.

America has a flooded market, every manufacturer in the world sells there yet its still the American brands that sell the biggest due to building the right cars/advertising/etc.

Australia really doesn't have it that bad, most of these cars supposedly 'flooding our markets' are priced for footballers, not the average buyer.

The way to save local manufacturing is not by making life harder for imports but by local manufacturers building cars that are relevant to the times. 400kw GTS's and blown GTs might appeal to performance enthusiasts by the average buyer either doesn't care or it just ins't practical enough for a modern day family. Rather than focusing on the near dead large car market focus on SUVs that out sell them hand over fist.

[2011G6E]

But someone will always come along who can do what you're doing better and cheaper, and if you don't move with the times you die.

The British bike industry ruled the world for decades, until out of the blue the Japs who had been making funny little commuter bikes for many years all of a sudden brought out things like the Honda 750 Four, the Kawasaki two stroke triples, and the Z900 Kawasaki. The Brit bike industry couldn't...or wouldn't...adapt, too stuck with ideas of "tradition", and it sadly died a quick death, not really recovering until the late 1990's ad really finding it's feet in only the last ten years or so.

The car makers in the USA, Australia, and, to a lesser extent, Europe, faced a similar onslaught from cheaper and better made and better equipped Japanese cars in the seventies and into the eighties.
Some of the car makers suffered from the same stale ideas of appealing to tradition, which worked about as well as it did for the British motorcycle industry. They've never really recovered and it's gone from the days of it being a little odd to own a Jap car, to being quite normal.

Then in the late eighties and into the 1990's we had to face the Korean onslaught...starting out with cheap cars that were just rubbish, to today where we see amazing things like the Veloster, which no one would have imagined even ten years ago coming out of Korea.

Now, we see the emergence of China and their vast industrial complex...if anyone honestly thinks their cars are going to remain flimsy cheap buckets of bolts and are nothing for our car makers to be worried about, they've got rocks in their head.


Times change...but things like this just seem to keep going around in cycles...
That's not being fatalistic or derogatory to the local industry...it's just facing reality.

[UberKnee]

Originally Posted by 2011G6E

But someone will always come along who can do what you're doing better and cheaper, and if you don't move with the times you die.

The British bike industry ruled the world for decades, until out of the blue the Japs who had been making funny little commuter bikes for many years all of a sudden brought out things like the Honda 750 Four, the Kawasaki two stroke triples, and the Z900 Kawasaki. The Brit bike industry couldn't...or wouldn't...adapt, too stuck with ideas of "tradition", and it sadly died a quick death, not really recovering until the late 1990's ad really finding it's feet in only the last ten years or so.

The car makers in the USA, Australia, and, to a lesser extent, Europe, faced a similar onslaught from cheaper and better made and better equipped Japanese cars in the seventies and into the eighties.
Some of the car makers suffered from the same stale ideas of appealing to tradition, which worked about as well as it did for the British motorcycle industry. They've never really recovered and it's gone from the days of it being a little odd to own a Jap car, to being quite normal.

Then in the late eighties and into the 1990's we had to face the Korean onslaught...starting out with cheap cars that were just rubbish, to today where we see amazing things like the Veloster, which no one would have imagined even ten years ago coming out of Korea.

Now, we see the emergence of China and their vast industrial complex...if anyone honestly thinks their cars are going to remain flimsy cheap buckets of bolts and are nothing for our car makers to be worried about, they've got rocks in their head.


Times change...but things like this just seem to keep going around in cycles...
That's not being fatalistic or derogatory to the local industry...it's just facing reality.

Exactly its a matter of evolving with the times and the market. If the Chinese, Koreans, Japanese are coming in to the Aussie market and outselling the local manufacturers hand over fist the answer isn't to make it harder for the imports to arrive in the country and be sold for a reasonable price just to protect the behind the times locals. The answer is for the locals to focus on what the customers are actually buying, Holden putting so much stock in the Commodore and Fords biggest advancements being towards the Falcon when the market isn't there is foolish.

Evolve or die.

[in shock]

Aussie cars have been rough in the past at every level, build quality and very basic design, nearly junk quality but slow improvement and a major wake up call with the import of japanese cars has seen things improve to our latest aussie build cars. Ford Holden Toyota are world class and built here. Falcon had rural australia riding on its back for years and while a lot are still buying Falcons for the rural roads, sales have dropped off while the Holden Ute are like backsides everyone has one

[Franco Cozzo]

I work in auto manufacturing industry, we should all go to Museums and we can be the attractions, teachers can come and point out to their kids about times long gone when we used to build cars.

[Joe5619]

Originally Posted by 2011G6E

...and easy to fool into thinking whatever they are getting dished out to them is "worlds best...trust us!"...as I said, they know now what they would be missing out on if we put up the walls and kept imports out or taxed them into oblivion. A true (automotive) case of "How you gonna keep 'em down on the farm, now that they've seen Paree".

As I said, go back to the seventies when protectionism of the local car industry was high...our neighbour, a Holden man through and through, had just bought his latest Kingswood wagon, a V8 Vacationer. My old man within a week of this bought our latest car, a Mazda 929 wagon, top of the line. The 929 had air con, a floor shift four speed, and AM/FM radio cassette fitted from the factory with four, count 'em four speakers (and the aerial concealed in the windscreen glass!), and window tinting amongst other standard fittings.
The neighbour had his faith badly shaken when he took my old mans car for a drive...he was seriously wondering if his next car would be a Holden at all.

Britain went through it with their car industry, yet their industry, after chopping out all the dead wood and getting rid of makes that just couldn't keep up with modern times, is better than ever.
Our car makers need to sit down and take a good long hard look at themselves and more importantly what they're competing against and what the public wants, and don't just keep trying to rely on selling cars the old fashioned way which doesn't work anymore: that being multi-generational badge-blind buyers who will just unquestioningly and automatically trundle down every couple of years and buy a Holden/Falcon just because daddy had one and his daddy had one.

Are all your comments lately about protectionism based on the seventies?? We aren’t talking about going back to the seventies!!!. If the seventies didn't work & what we have now clearly doesn't work, does it stand to reason that the answer is somewhere in the middle?


The only good thing that might come out of Ford leaving.. Is it might just save the industry for Holden & Toyota & some real change might happen!!

[Silver Ghia]

Its not just the car and other manufacturing industries that has this big problem, its also the food products from Thailand, whether straight from there, or imported and packaged here in Australia. And there's no guarantee of how these food products are produced or where they come from.

I really think that those responsible for signing these trade agreements should be held accountable for criminally stuffing up this country, and have their fat pensions revoked. It will never happen unfortunately, politicians etc. first priority is to protect themselves.

[CyberWasp]

Don't we need a manufacturing industry for the sake of national security?

If there was ever a large scale world conflict how could we build / adapt vehicles for the war effort if all our current manufacturing plants are shopping malls and apartment blocks?