What can be done to improve the struggling Aussie Motor vehicle industry

[Ford17]

This is a long but worthwhile read...

Why the Aussie Motor vehicle industry is struggling by the CEO of Futuris (Elders)

Firstly, thank-you for those that provided some positive feedback from last weeks 'Part 1' Auto Blog - it was very much appreciated.

Just to refresh your memories from last week, the Auto Playing Field is NOT level, with Australia having the lowest Tariffs in the Auto making world (5% but with many FTA's, leading to an average tariff of 3.5%) and also the lowest per capita Government co-investment program at about $25 per person per annum.

So, onto Part (2)….What can be done to improve the situation?

First a few interesting facts to further set the scene:

• I mentioned last week that in 2011 Australia only produced 14% of all 1 million cars sold in this country annually.
• Did you know that 5 years ago, this was ~20%, 10 years ago was ~30% and 20 years ago this was ~53%?

So what has changed…….are we not making the right cars that people want?

• NO, in fact of the 5 platforms built in Australia (Commodore, Cruze, Falcon, Territory and Camry), in 2011, 4 were in the top 10 selling cars.

• If you add up the volume of the top 10 selling cars in 2011 it equates to only 295,212 vehicles. So even if we build every one of these top 10 in Australia (not just 4 of the 10), we would still only be at 29% domestically produced as a ratio to total sales.

• So Australia produces a meager 14% of all vehicles sold here, but if we include all export production as well, we made ~220,000 cars in total (140k domestically produced & sold + 80k for export) - so Australian total production to total sales ratio of 22%.

• Let's compare that to the 4 countries that make up most of (95%) the 86% imported cars sold here (Japan, Thailand, Korea and Germany).

- In Japan, sales of 4.4 million vehicles versus production of 8.4 million vehicles (190%)
- In Thailand, sales of 800,000 vehicles versus production of 1.5 million vehicles (188%)
- In South Korea, sales of 1.46 million vehicles versus production of 4.66 million vehicles (318%)
- In 2011 German vehicle sales of 3.17 million whilst production was 5.87 million cars (185%)

So why are we at 22%? Why has it come down from 53% 20 years ago? What do we have to do to get it right like these 4 countries above (and many others as well - from my research, almost every other car making country has a ratio > 50%)?

Let's first take a closer look at Tariffs

• Tariff rates for imported cars into Australia 20 years ago were a whopping ~32% (down from their peak of 57.5% in the mid 80's) and have been rapidly reducing ever since under the 'Button Plan'. More recently, they were reduced in 2005 to 10% and then again in January 2010 to 5% (effective 3.5%)

• By comparison, most mature car producing countries have at least 10% import tariffs (Germany, Korea, Japan, UK) + other various taxes and/or roadblocks.

• The exception is the USA, who have a 2.5% import tariff on passenger cars…….however, what most people don't know is that the local producers in the USA make a very large number of "pick-up trucks" (like the F150 Ford, Chevy Suburban, Toyota Tacoma etc), and in fact almost all profit for the North American producers comes from these types of vehicles……and if you want to import a pick-up truck into the USA, it attracts a huge 25% import tariff !! They protect their Golden Goose !!

• Since the Button plan in the late 80's was devised and Australia set a path to reduce tariffs to zero (this is the current plan in Australia from 2015), we have also seen the emergence of low cost countries as Auto producers. It is interesting to compare the import tariff should we try and send a car into one of these so called emerging countries……Thailand 80% (duty not tariff as explained last week); India 60% + duty of up to a further 50%; Russia 48%; Brazil 35%, Malaysia 30%; China 25% + 18% VAT. These countries are all now importing cars to Australia (at 5% or some at Zero). I find it interesting that the likes of China, who are now the largest Auto producing nation on the Planet (18 million cars/trucks produced per year and growing), with the World's second largest economy, is seen as an 'emerging' player who can justify 25% Tariffs + 18% VAT !

So, we've established that in relative terms to every other Auto producing nation, we have scaled down our industry protection (and co-investment - see last week) to almost nothing…….and the net effect is that we have the most open Auto market in the world

• Did you know that more vehicle brands and models are on sale in Australia than any other country in the world (~64 brands at last count, with over 240 model variants to choose from)?

• By comparison in the USA, where they sell about 14 million cars/trucks per year (versus our 1 million), there are only 33 brands on sale! That is 14 times the amount of sales but only half the number of brands !

• 20 Years ago there were 48 brands in Australia and only 97 model variants to choose from.

So, should we just raise Tariff's?

• Well, my view is that, with the exception of cutting some slack for genuinely emerging countries, in a very small manufacturing market like Australia tariffs should al least be reciprocated (in fact, with our lack of economy of scale, there is an argument to be higher than Japan and Korea etc). That is, I have no problem scaling down to zero - as long as everyone else is doing the same. But clearly they are not. With the onset of the GFC, many nations chose to freeze their tariff positions, and in fact some (like Brazil), actually raised them to offset the effect of their high dollar. Reciprocity (except for genuine emerging countries) - you can't get fairer than that. If it is 10% + 19% VAT for us to get an Aussie car into Germany, then we should have a 29% total tariff + duty on German cars to Australia (rather than 5% today falling to 0% in 2015)……43% (25 + 18%) for Chinese cars; 10% for Japanese cars etc.

But won't this just raise the price of cars for Australians?

• NO - if you buy an Aussie made car …… and that is the point !

• YES - if you buy an imported car. However, a 5% increase in Tariff on a $35k car is a $1750 increase…….this pales into insignificance when compared to the savings that we should be getting from the Aussie dollar appreciating 40% in the last 5 years!

• The other added benefit is that a 5% increase in Tariff (back to a 10% average like most other mature Auto making countries) would raise Government revenue by ~$1.2 billion - which I'm sure we can all think of some good ways to spend.

As right and fair as I think reciprocity is, the likelihood of our Government altering the tariff path is virtually zero.

So what else can be done? Here's one that

• So ~220,000 cars in 2011 were built in Australia (140k for domestic consumption and 80k for export).

• Did you know the Governments (Federal, State and Local) + fully funded Government bodies (the likes of the ABC, Medicare, Gov't schools, Youth services…..there are literally hundreds of taxpayer fully funded departments and agencies) purchased 60,000 vehicles in 2011 (down from ~100,000 in 2004 as we tighten recent spending)

- Of these 60,000 vehicles, only 19,772 were Australian made !
- This is a disgrace!
- It costs no more to purchase a Holden Cruze than a Hyundai i30 or a Mazda 3……or a Falcon EcoLPG or Toyota Camry than a Honda Accord or a Hyundai Sonata……so it is not price.

• Local products are now just as 'Green' as any imported car - we now make LPG Falcons and Commodores, diesel Cruze and Territory, Hybrid Camry, 4 cylinder Falcon…..there is NO 'Green' excuse not to buy Australian for Government fleets.

• Why is it OK that the Mayor of Hobsons Bay (Altona - where thousands of people are employed by Toyota and many suppliers) has our taxpayer money paying for a $51,000 Saab 9-5 when he should be driving a Toyota Aurion?

• Now, there are some special purpose vehicles that we don't make here - for example, Police in the Northern Territory need full FWD capable vehicles - but let me be generous and say these special purpose cars may make up 25% of the 60,000 total procured……so ~45,000 vehicles (minimum) of the annual 60,000 purchased should be local made products.

• At 220,000 vehicles produced here, an increase in Government fleet purchase from ~20,000 cars to 45,000 cars (25,000 improvement) is an 11% improvement to our Australian production total………the industry would kill for that!

• With 60,000 people directly employed in the Australian Auto sector - about half of which are on direct production activity - an 11% improvement in volume would create about 3000 jobs!

• In analysing the data further, Federal Government procure about 44% local vehicles; The Vic and SA State Governments do a reasonable job (at ~70%). NSW, QLD and WA are poor at 32%, 20% and 17% respectively. Local Councils take the (poor) cake at 16%.

• Please get vocal about this !

Any other ideas? Yep, lot's…..but to pick out just a couple:

Safety

• Of the 1 million cars sold here in 2011, 30% (300,000) did not meet the 5-Star ANCAP safety rating.

• All Australian made cars meet the 5-Star ANCAP safety rating.

• The cost of all road accidents in Australia is estimated (by the department of infrastructure) at $18 billion/year

• Why don't we put a penalty on new cars that don't meet 5 Star - say $2500 for each star below 5…..so a 3-Star vehicle would attract a $5000 levy.

• This would discourage purchases of less safe vehicles. A 5.5% improvement in the accident costs (through prevention and/or minimising injury) would mean $1 billion of that $18 billion / year cost would be saved.

• It would also have the potential effect of shrinking the number of brands and model variants - with people moving to safer (and perhaps local) brands and models.

Gaseous Fuels

• Australia is a net importer of Petrol / Oil.

• Despite our very high dollar, making importing cheaper, Petrol this morning rose to $1.64 per litre

• Many experts are projecting by 2020, petrol in Australia will be around $6 per litre…….and being a finite and diminishing resource with increasing global demand from China and India in particular, it is not that difficult to believe that this is possible / probable.

• Australia is sitting on the 12th largest natural gas reserves in the world.

• If we converted every car to run on compressed natural gas (CNG) in Australia, with our projected population growth, we would have enough of our own current reserves to last 90 years!

• The current equivalent per litre cost is between 19 - 26 cents!

• Compared to a Petrol engine, CNG delivers 40% less CO2, 80% less CO and 90% less NO.

• It is 50% quieter than a Diesel engine

• It leads to lower maintenance

• It is lighter than air, so if spilt, is easily mixed.

• Is less likely to auto ignite (needs to be at 540 degrees C)

• In 1996, there were 1 million CNG cars in the world. In 2011 there are 14.8 million.

• Now, CNG is not LPG……LPG is derived from Oil and is liquefied (hence the 'L'). CNG is compressed natural gas and its only downside is that it takes up more space.

• Many buses in Sydney already use CNG. Cars and Taxi's in India, Brazil, Argentina, China, Iran etc are using CNG. Trains in the Napa Valley in the USA.

• So, my view is we need to get people in Australia used to using gas….the technology has come a very long way - in fact the Falcon LPG vehicle is more powerful than the Petrol variant and I would defy anyone to pick the difference in smoothness or refinement - it also costs less to run than a Mazda 3……so let's have Government offer huge incentives for gaseous fuel cars. This can be justified under the banner of 'Green', as even LPG is far cleaner than Petrol.

• I think the incentive should be (1) a $5000 rebate from Government for dedicated factory fit Gaseous fuel vehicles and (2) be FBT exempt……the net effect of these two things would provide a massive shift toward Gaseous Fuel vehicles.

• Now here's the good bit for Australian industry……the only vehicles in the 64 brands and 240 models currently sold in Australia that are dedicated factory fit Gaseous fuel are the LPG Falcon and the LPG Commodore…..Aussie made, so we get more production volume, more jobs, and a greener outcome. The cost impost to Government could be covered by the revenue generated by the safety levy or by increasing tariffs back to ~10%!

• Then we need to shift the future Government research funds toward CNG technology. Given our natural reserves, why not become a global leader in CNG technology and a niche producer of CNG vehicles - the export markets would be large.

• In my view we have to build industries and business not just around the skills and passion of the people, but around strategic benefits we have as a Country - and we are sitting on one in CNG.

So, in summary, what I think we can do to improve the situation:

(1) we need Fair Trading Terms - it can't get any fairer than reciprocal Tariff and Duty arrangements.

(2) Our tax payer funds MUST be directed towards locally produced purchases for Government fleets - especially where there is no cost impost and no longer any 'Green' rationale not to

(3) We should take a stand on Safety and not allow (relatively) unsafe vehicles to be sold here without significant penalty

(4) We need to reduce our oil dependence and use our naturally abundant resources to our advantage

And all of these smart and logical things will have an added benefit of significantly improving the health of the local Auto industry.

[Resurrection]

As a former member of this industry with almost two decades in it I can say there is not much hope for this industry. The volumes are below critical mass which means it isn't a viable for any of the remaining players. Remove the ACIS/ATS subsidies and it would implode very quickly.

[XWGT]

I dont know where you got that from but its very good.

[Brazen]

Excellent points, I agree on all of them

[Kayos]

Petrol this morning rose to $1.64 per litre
Here we have a no reason raise from the petrol boys, and the gov toothless tiger has again started another investigation, which then should again take months before it slowly comes back down.
So, should we just raise Tariff's?
Yes, Tariffs should have been raised at least 10 years ago on imported vehciles, this may have helped down under production (big time). No matter how the other country is progressing, but reasons it hasn't is that this may have a global unseen influence that we may never know about, int trading so on so forth..

[mik]

i had a nice big post but as it could have been deemed a bit political in places i have deleted it, however, i have to say my conclusion is i like your thinking,
unfortunately the current trend seems to be "those that be" like Australia to be the import dumping ground of the world, you could easily think there is something to (agenda 21) if you look right into it.
my own assessment is they just wish to shrink Australia`s manufacturing, i made my money out of imports for half a dozen years or more, and that`s what i saw and still see, "those that be" like to hand out small donations to struggling big companies in the public eye like a missionary to homeless person. the only way to change the status quo is to change of policy(from you know who), if we can do that i reckon manufacturing will have a chance to kick on.

[BrisVegas]

excellent ideas. I particularly think that govt fleets should be compelled to buy Australian built vehicles, unless they can demonstrate an exceptional circumstance.

Tariff reciprocity is a fantastic idea too.

[Road_Warrior]

I agree with all that, particularly with the bit about government departments and local councils not buying Australian made cars.

Here is something from a paper I wrote on the subject of tarrifs and the Button Plan from a while back, but it has a heavy slant towards Falcadores, so just be mindful of that when reading.

The large car segment in Australia has been in decline for over 10 years. Staple products in this segment, the Ford Falcon and Holden Commodore, once dominated the automotive landscape in Australia but now command less than [percentage] of overall new vehicle sales in the country. Up until recently, Ford and Holden relied on their respective large cars as their main source of revenue. This is still the case, to a degree.

In concert with the overall decline of sales of large cars, there has been a gradual increase in consumer takeup of Sport Utility Vehicles (SUV's) and smaller vehicles, particularly from the C-segment (eg. Toyota Corolla, Mazda 3). Compounded with an increase in petrol prices, and new product offerings in a variety of segments, new car buyers in Australia have shunned the traditional Aussie sedan.

Tax reforms relating to vehicle imports by car companies have led to an unprecedented level of choice for consumers. Similarly, a change in consumer attitudes towards vehicles that offer more 'flexibility' for lifestyle choices and vehicles that are more family friendly have introduced a new dimension into the automotive market.

In 1982, the Minister for Industry and Resources, Senator John Button, proposed a reform of the Australian automotive industry which was called the Button Car Plan, or Button Plan for short. The Button Plan called for indigenous car makers to establish joint ventures with one another (and foreign car makers), badge engineering, and a reduction in the import tariff rating effecting new imported cars. Whilst the joint venture and badge engineering aspects of the Button Plan ultimately failed, successive governments continued to roll back import tariff ratings to the point where the tariff is currently 5%.

The thinking behind tariff reduction was that it would allow imported cars to become cheaper and more accessible to Australian consumers, thereby increasing competition in the market and providing incentive to local car makers to improve their products to meet the competition, to level the playing field. In short, the theory was "competition betters the breed".

Whilst this theory was sound in principle, in practice it has had the effect of pushing local car makers towards insolvency and closure (like Mitsubishi's manufacturing operations in Australia). The rollback of tariffs has gone over and above what was necessary to open the market up to competitors. Local car makers are owned by foreign corporations and are given limited funding for development of new models. Those foreign corporations will not allow a local arm to duplicate a car here that is being made in lower-cost assembly plants elsewhere in the world, and because of this, local car makers have over time designed and built their own products with the funding they have available.

Another flaw of the tariff reduction program was that it failed to consider the fact that importers were able to import vehicles that were global platforms developed for global markets, which have an according budget allocation to develop them. This expenditure on such a car would be quite high, but can be recouped through amortisation of those costs across the global market as those cars are sold in several different regions (like the Mazda 3 is sold in Europe, North America and Asia). The local car makers do not have this luxury and cannot compete with the economies of scale foreign car makers can bring to bear, and the production volumes they can draw on. Contrary to the intent of the Button Plan to create a level playing field, it has resulted in a playing field that is substantially lop-sided.

However it would be misguided to assume that the fortunes of Australia's car makers are poor because of government intervention.

Local car makers have generally failed to account for changing market trends and consumer preferences. In Ford Australia's case, incessant management change and interruption (and cancellation) of approved products and plans has created uncertainty over the future of its local operations and has delayed the release of crucial new products to the market. In GM-Holden's case, the Global Financial Crisis caused irrepairable damage to its parent company, General Motors, which adversely effected Holden's ability to raise capital and bring new products to the market.

This corporate dithering and uncertainty, combined with rising fuel prices and tariff reductions, has created an almost "perfect storm" which could engulf the local car manufacturing sector and the thousands of supplier jobs that it supports. This in turn could cause the collapse of an industry that the Federal Government has termed a 'strategic industry'. The consequences of a failure of one of Australia's strategic industries would be catastrophic.

I didnt get any further than this because I got distracted by other things. Oh well

[rdmr]

Yes, this is one subject that bugs me to no end.
The sillyness continues to this day. The recent free trade agreement with Malaysia signed this year is an example. Instant reduction of tariffs to zero for Australia but Malaysia is allowed a 4 year grace period to reduce theirs.

Governments at all levels should buy aussie made only, with some exceptions, for example 4wd vehicles.
If tarriffs cannot be raised again as we have signed up to international treaties, then introduce levies or taxes on imported vehicles that do not match the safety standard of Australian made vehicles.
And/Or, a congestion tax on imported vehicles embedded into their yearly registration, payable on all vehicles including trucks. We still have truck manufacturers here still too. A 100% tax, effectively doubling their registation fee would deter many buyers. This tax could be limited to the warrantry period of the car.

The bottom line is governments need to do much more.

[aussie muscle]

Originally Posted by rdmr

Yes, this is one subject that bugs me to no end.
The sillyness continues to this day. The recent free trade agreement with Malaysia signed this year is an example. Instant reduction of tariffs to zero for Australia but Malaysia is allowed a 4 year grace period to reduce theirs..

i'll bet in 4 years Malaysia has a new duty or fee on australian cars, so while they'll reduce their tariffs, they'll neuter them with other hands.

[Franco Cozzo]

Australian government should be supporting Australian industry and manufacturers, if you've seen a Victorian ambulance, all the furniture in them is made in China, they stopped getting it made in Australia for cost reasons, then the quality went down the S bend, and it was costing more to rework the furniture and get it to an acceptable standard than just getting it made here in the first place, we put out over 60 new ambulances with this crap in it.

Then they finally gave into getting it made in Australia again and they sent the wrong plans and had it made up wrong and it had to be reworked again.

Its like they're trying to deliberately fail Australian made stuff to go back to China.

Our QA guy suggested to the heads of Ambulance Victoria to spend more money and support Australian industry but it fell on deaf ears.

Victoria Police brought in their new whizz bang unmarked VW Touraeg for us to inspect, which they didn't want us to lay a finger on because the wagon alone cost them $110K. You could get two diesel Territories for that price.

Maybe the Government should put in more effort into buying Australian made products too.

[bobthebilda]

Just a few questions

Forda]This is a long but worthwhile read...

Why the Aussie Motor vehicle industry is struggling by the CEO of Futuris (Elders)

Now is this the CEO of Elders that is currently trying to sell its automotive arm (Futuris). I bet you he's not limiting his potential purchasers to australian only companies.

So, should we just raise Tariff's?

• Well, my view is that, with the exception of cutting some slack for genuinely emerging countries, in a very small manufacturing market like
But won't this just raise the price of cars for Australians?
• NO - if you buy an Aussie made car …… and that is the point !
• YES - if you buy an imported car. However, a 5% increase in Tariff on a $35k car is a $1750 increase…….this pales into insignificance when compared to the savings that we should be getting from the Aussie dollar appreciating 40% in the last 5 years!

If he doesnt beleive it will raise prices of Australian made cars (and only imports), then what will be the benefit to australian manufacturers. They will still manaufacture at a loss. Seems like his only intention is to punish people who want to make a choice

The other added benefit is that a 5% increase in Tariff (back to a 10% average like most other mature Auto making countries) would raise Government revenue by ~$1.2 billion - which I'm sure we can all think of some good ways to spend.

Yes, you put $1.2 billion into governments hands and everyone knows they spit $500 million out the other end.

• Did you know the Governments (Federal, State and Local) + fully funded Government bodies (the likes of the ABC, Medicare, Gov't schools, Youth services…..there are literally hundreds of taxpayer fully funded departments and agencies) purchased 60,000 vehicles in 2011 (down from ~100,000 in 2004 as we tighten recent spending)

- Of these 60,000 vehicles, only 19,772 were Australian made !
- This is a disgrace!

And the CEO of Elders does not drive an Australian made car.

- It costs no more to purchase a Holden Cruze than a Hyundai i30 or a Mazda 3……or a Falcon EcoLPG or Toyota Camry than a Honda Accord or a Hyundai Sonata……so it is not price.

Its exactly why his company is failing, he doesnt understand the concept of quality.

• Please get vocal about this !

People who run a company that has lost approx 95% of shareholder value since he took over, should be worried if everyone got vocal.

The cost of all road accidents in Australia is estimated (by the department of infrastructure) at $18 billion/year

• Why don't we put a penalty on new cars that don't meet 5 Star - say $2500 for each star below 5…..so a 3-Star vehicle would attract a $5000 levy.

• This would discourage purchases of less safe vehicles. A 5.5% improvement in the accident costs (through prevention and/or minimising injury) would mean $1 billion of that $18 billion / year cost would be saved.

Theres no link that 4 star rated cars produce more deaths or injuries than 5 star rated cars.

• Many experts are projecting by 2020, petrol in Australia will be around $6 per litre

Anyone who has watched Elders profit predictions since the CEO came into power will know that $6 per litre could mean anywhere between 50 cents and $20.

Next someone will be putting up a thread with quotes from Kermit the frog describing the merits of Mazdas latest designs.

[Ford17]

Originally Posted by bobthebilda

Just a few questions

I'll try and help as best as possible, but my main concern is the very valid points made in the article.

Originally Posted by bobthebilda

Now is this the CEO of Elders that is currently trying to sell its automotive arm (Futuris). I bet you he's not limiting his potential purchasers to australian only companies.

I'm not sure as it is an internal Elders document, a company which i do not have a direct relationship with.
My interpretation is it was written by the CEO of Futuris, an Elders owned company.
I do believe Elders are trying to sell Futuris, as it doesn't fit in to their core agriculture business model.

Originally Posted by bobthebilda

If he doesnt beleive it will raise prices of Australian made cars (and only imports), then what will be the benefit to australian manufacturers. They will still manaufacture at a loss. Seems like his only intention is to punish people who want to make a choice

Presumably more sales will go to locally built cars, thus increasing their revenue, which will offset their overhead costs. This would result in either reduced losses or increased profits.

Originally Posted by bobthebilda

Yes, you put $1.2 billion into governments hands and everyone knows they spit $500 million out the other end.

Your point being?
It might even help Mr Swann deliver the surplus he so desparately wants

Originally Posted by bobthebilda

And the CEO of Elders does not drive an Australian made car.

Maybe he wanted an LTD, but couldn't buy a new one anymore?
Maybe his wife had a big say in what car he chose?
As the article states, Australia has the biggest choices available for new cars.

Originally Posted by bobthebilda

Its exactly why his company is failing, he doesnt understand the concept of quality.

Not sure how this fits into the equation here - what Elders products are of substandard quality?
Are they locally made or imported from China?
Please elaborate further if you could.

Originally Posted by bobthebilda

People who run a company that has lost approx 95% of shareholder value since he took over, should be worried if everyone got vocal.

Again, not sure where this fits into how to improve the local car industry.
One of the few intelligent quotes Christopher Skaise issued was "investing in a company is somewhere between putting your money in the bank, and putting it on a horse".
Perhaps your super fund has also taken a backwards step recently?

Originally Posted by bobthebilda

Theres no link that 4 star rated cars produce more deaths or injuries than 5 star rated cars.

As a tax, it would be just as a quantifiable, if not more quantifiable; than say a 'carbon tax', or an 'alchopops tax', etc.

Originally Posted by bobthebilda

Anyone who has watched Elders profit predictions since the CEO came into power will know that $6 per litre could mean anywhere between 50 cents and $20.

Maybe so, but when has petrol ever significantly gone down in price?

Originally Posted by bobthebilda

Next someone will be putting up a thread with quotes from Kermit the frog describing the merits of Mazdas latest designs.

Hey - don't shoot the messenger!

[Wretched]

hmmm interesting article but can't say I agree with most of it.
The local industry is struggling but has anyone bothered to answer the most obvious question?

Why are the buying public not purchasing local made cars? As a comparison what is it that the cars they do buy have over the local car makers?

The same questions should be applied to fleets as well.

May be then a better understanding of why sales have dropped out of the locals.

[Franco Cozzo]

Originally Posted by Wretched

Why are the buying public not purchasing local made cars? As a comparison what is it that the cars they do buy have over the local car makers?

They don't make what I buy.

Except they're on a winner with the diesel Territory with everyone.

[robbyj]

the most underlying reason is no one wants large 6 cylinder and 8 cylinder cars anymore. While Australian car manufacturing was still tooled up to make these large cars, the market has greatly reduced, meaning we need to import smaller cars, being made elsewhere, to meet the new market demand. (as the price of fuel continues to scare people into buying more affordable cars to run)

Why pay 30+grand for a large fuel guzzler when u can buy a car for half the price that costs half as much to run?

[Ford17]

Originally Posted by robbyj

the most underlying reason is no one wants large 6 cylinder and 8 cylinder cars anymore. While Australian car manufacturing was still tooled up to make these large cars, the market has greatly reduced, meaning we need to import smaller cars, being made elsewhere, to meet the new market demand. (as the price of fuel continues to scare people into buying more affordable cars to run)

Why pay 30+grand for a large fuel guzzler when u can buy a car for half the price that costs half as much to run?

If you read the original article, all your questions will be answered, grasshopper.

[Ford17]

Originally Posted by Big Damo

They don't make what I buy.

Except they're on a winner with the diesel Territory with everyone.

Which car are you currently in the market for?

[robbyj]

Originally Posted by Forda

If you read the original article, all your questions will be answered, grasshopper.

I read the article, and some very good ideas in there. The idea that has stood out for me was government revenue for increasing tariffs/unsafe/petrol cars to be spent on rebate for these gas cars we could produce.

Still, if our car manufacturing had of geared appropriately for the changing market, we wouldn't have half the problem we do today.

[mik]

Originally Posted by Wretched

hmmm interesting article but can't say I agree with most of it.
The local industry is struggling but has anyone bothered to answer the most obvious question?

Why are the buying public not purchasing local made cars? As a comparison what is it that the cars they do buy have over the local car makers?

The same questions should be applied to fleets as well.

May be then a better understanding of why sales have dropped out of the locals.

for a start companies that can build cars cheaper and import them at a reduced cost can afford to offer 5 year warranty`s, they can afford to put more gear in their cars because the playing field is in their favour.

[302 XC]

Originally Posted by Wretched

The local industry is struggling but has anyone bothered to answer the most obvious question?

Why are the buying public not purchasing local made cars? As a comparison what is it that the cars they do buy have over the local car makers?

The same questions should be applied to fleets as well.

May be then a better understanding of why sales have dropped out of the locals.

End of the day its all about the bottom line
IF someone offers something cheaper, better services,and fits within a budget you have to buy there
$2 junket shops prove people dont buy quality brand name products,its just a follow on,just bigger scale
No point looking at water front if you cant afford rural
Ill never ever buy new again,regardless of what deal im offered
Theres better things to waste money on ...
Im sure im not alone along this line of thinking

[falconnut]

Export

Export

Export

[bobthebilda]

Originally Posted by Forda

Which is?
Is it something to do with old Porsches and a German autobahn?
Is this something to do with old Porsches and autobahns as well?
Does this mean 'The fleets' also need to travel down autobahns in Germany in old Porsches as well?

mmmm substantiates the point very well. Lets add the following article to highlight the hipocrisy in which these guys follow.

http://www.afr.com/p/national/car_in...H3zMNcPU82Yf1K

The prospect of a new tariff has sparked an angry response from Ford, General Motors Holden and Toyota Australia, which are also under pressure from a high dollar and rising costs.

What the car companies want is tariffs to protect them. When bluescope steel goes and seeks tariffs to protect itself, the car companies cry foul. The car makers having the ability to buy cheap steel is no different to the tradie or business owner having the same right to buy a cheap car.

[mik]

Originally Posted by bobthebilda

mmmm substantiates the point very well. Lets add the following article to highlight the hipocrisy in which these guys follow.

http://www.afr.com/p/national/car_in...H3zMNcPU82Yf1K



What the car companies want is tariffs to protect them. When bluescope steel goes and seeks tariffs to protect itself, the car companies cry foul. The car makers having the ability to buy cheap steel is no different to the tradie or business owner having the same right to buy a cheap car.

well you could look at it that way, but it`s not hard to see their point, they are already up against the wall trying to compete with imports that already have them over a barrel, they could probably afford to buy Australian steel if the playing field was level, but it is far in the the importers favour, adding another cost is a nail in the coffin for the locals and is another nail in the manufacturing coffin and not of their doing.

[robbyj]

Originally Posted by falconnut

Export

Export

Export

Who wants to buy our expensive vehicles, given that our dollar is also high.

Unfortunately the thought of an Aussie V8 only impresses a small population.

[Buntz]

We need tariffs. That will remove a third of those brands I reckon. Some of which are the same thing anyway.

[Stefan]

Some good points.

I don't understand why Gov Departments are not mandated to by Australian vehicles. That would go along way.

It would be very hypocritical of the Government to raise tariffs on imports on one hand and at the same time not buying Australian.

[dogfish]

Build Tghe Mustang Locally, Build The Camaro Locally, Build The Dodge Charger Locally, I'd buy a new Stang or Camaro for $40,000 rather than $170,000. They are roughly $40,000 new in the states so why can't we build it here the same as the Fairmont GT was shipped to South Africa as pressed panels and assembled for their local market. Our cars are boring a GT is a falcon with a blower and some suspension asnd brakes oh leather as well but it's still a bloody Falcon at the end of the day same with the Commodore just not exciting compared to a new Nissan or Subaru that has wonderful Refinement great re sale and all the bells and whistles to hoot.
As stated I would buy a Mustang or Camaro I have no kids and the only options I have of not buying a Family Wagon/Sedan has to come from a foreign made car or buy a greedy import for $170,000 and I am not going to part with an extra $100,000k for a rhd conversion and an adr when if Ford Australia had the Bollocks they could build the bloody thing here.

[Franco Cozzo]

Originally Posted by Forda

Which car are you currently in the market for?

I've bought a new Fiesta and I bought my Focus new as well, we all drive small cars in this household.

I'm not in the market right now but I will be come 2014 when I'm off my P plates and up for something fast.

[gtxb67]

why don't ford and holden tell the government they are importing the falcon and commode dore from indonesia
the idiots running the country won't know they are really built here, but believing they are from indonesia, they will receive billions in subsidies and the government will actually start buying them . . . . . problem solved