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Australia votes: Car industry waits for directions

New start: Prime Minister elect Tony Abbott declared that Australia is "open for business" during his victory speech on Saturday night.

Focus swings to how the Abbott-led government will handle car-making industry

General News logo9 Sep 2013

AUSTRALIA’S car industry is today in a state of flux as the showdown between manufacturers and the newly elected Liberal-National Coalition government looms.

Prime minister-elect Tony Abbott has declared Australia is “once more open for business” as he prepares to take charge of the nation’s welfare, including that of its ailing car-making industry.

In the federal seat of Wakefield, where the future of Holden’s Port Elizabeth assembly line hangs in the balance, Labor incumbent Nick Champion appears to have held on by a narrow four per cent margin.

Outgoing industry minister, Victorian Senator Kim Carr, has held onto his seat in the upper house as he assumes the shadow ministry – at least until a Labor party room reshuffle is announced in the wake of the election.

He painted a gloomy future for Holden under Mr Abbott’s leadership, and called on the Coalition to change its view on manufacturing.

“I remain deeply concerned that if the Liberal Party’s policies are implemented, Australia will not benefit from $1 billion of investment from General Motors Holden,” he said in a statement to GoAuto last night.

“Statements made during the campaign by senior Liberals suggest that a lot of work will have to be done to improve the new government’s understanding of how the automotive industry actually works.

“The removal of $500 million from the Automotive Transformation Scheme, and the failure to match Labor's additional commitments would see the end of the automotive industry in this country,” Senator Carr said.

“Nowhere in the world does the automotive manufacturing industry operate without appropriate government support. Tens of thousands of manufacturing workers across Australia depend upon getting the new government to change its position on manufacturing.” Meanwhile, a cloud hangs over the Coalition’s industry spokesperson Sophie Mirabella as she fights to retain her northern Victorian seat of Indi, which could still rob her of the chance to take the parliamentary seat left vacant by Senator Carr. A result is expected later this week.

Ms Mirabella faced a strong challenge from independent candidate Kathy McGowan, although this morning she holds onto 44 per cent of first preferences as the remaining postal votes are tallied.

Mr Abbott is yet to announce his formal cabinet line-up, although a formal announcement is expected after his official swearing in as prime minister next Monday.

Federation of Automotive Products Manufacturers (FAPM) chief executive Richard Reilly said his members would be keen to see Mr Abbott’s Productivity Commission review of the automotive industry started as soon as possible.

Mr Abbott promised that, if elected, the Coalition would launch a Productivity Commission review into Australia’s car-making industry, looking at the level of finding the industry receives.

“We’d like to see it started in the next three to six months,” Mr Reilly said. “We need certainty in the industry.” Mr Reilly said the FAPM was also still “extremely concerned” by the $500 million the Coalition said it would take out of the ATS.

Australia’s three car-makers will expect savings of about a $460 million once the previous Labor government’s carbon tax is rolled back, while Ford Australia should welcome the repeal of changes to the way salary-sacrificed and leased cars are taxed that it blames for a huge fall in Falcon sales.

Toyota Australia said it would look forward to working with the new government to develop clear and consistent long-term policy that supports the growth and development of the Australian car industry.

However, the car-maker would not commit to saying if plans for adding a third model to its Altona production line – potentially the strong-selling RAV4 soft-roader – were still on the table.

“Toyota Australia evaluates its business model and vehicle line up on an ongoing basis as part of its planning and strategy processes,” said Toyota media and external affairs manager Beck Angel.

“There are still many challenges, however we are doing everything we can to continue building cars in Australia.” Holden, which took a hard line with unions earlier this year as it thrashed out a new round of wage savings, was today meek in its response to the change of government.

“We congratulate Tony Abbott and the Liberal-National Coalition on their election win and look forward to sitting down with the Abbott government to have detailed discussions about future automotive policy,” said Holden senior manager of public relations and technology communications, Andrea Matthews.

“We have nothing further to add at this point and do not intend to keep a running commentary on our discussions with government.”

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