OK, it was an interesting article but it contained no surprises and nothing I wasn't already aware of. In fact, whilst it broadens the range of problems faced by our manufacturers, it supports my comment above about the economics of maintaining production of cars here.
For our manufacturers to continue designing and building cars in Australia, they have to target the market they are aiming at. As I have said before, Australians are buying large sedans in decreasing numbers, but the sales of boring SUV's (yeah, they are pretty boring - most practical things are), or small sedans or hatchbacks. Holden has already indicated that it is looking at building an SUV on the Commodore production lines once the VF ceases production, perhaps before. Many members of this forum bemoan the loss of Holden eventually, but how many of them have bought a NEW Holden at some stage and done their bit to keep the company viable? Quite a lot, I reckon, but only a small percentage of the total membership of the forum. I have never bought a new Holden, but members of my family have bought several. The fierce depreciation they suffered made them wonder if it had been such a good idea in the first place, although this is common to most makes. Holdens and Fords just seem a bit worse than many others.
The one thing that article outlined which gets under my skin is the comparatively degree of subsidisation our manufacturers get per vehicle or per head of population compared to Euro, Jap and American makers. It is a common statement that Federal and State governments shouldn't be subsidising large foreign owned companies. Our subsidies come in for a lot of public debate and complaint, yet they are peanuts compared to other countries. In addition, we have this half-witted idea of "level playing fields", where we reduce tariffs to the point where they are virtually non-existent, yet other countries maintain higher tariff barriers to protect the local industries. How stupid are we? Whilst high tariffs can lead to over-protection of inefficient industries, which is what we had during the 60's and 70's, prior to the Button Plan, a sensible tariff can provide a modicum of protection without creating a false perception by local makers that they can sell beads to the natives (ie any old thing is good enough). Australians have now had a taste of an enormous range of vehicles from nearly every maker on earth and simply making the same old cars here won't work any longer.
Another protective barrier which has been removed along with reduced tariffs was the guaranteed percentage of the total market that was available to imports. During the 50's and 60's, I think there was a limit of something like 20% of the market being available for imports. Local assembly and manufacture was guaranteed the lion's share of what was a very small market at that time. Free trade and abolition of such barriers has led to a much more open market and local production has suffered as a consequence. Again, it has been the locals reluctance to adopt the more comprehensive marketing strategies of their foreign competitors (ie better equipped cars with more modern technology built in) which has hindered their growth. Until 2004, for example, Holden's mainstream model still ran a pushrod cast iron V6 dating from the 1960's and a four speed automatic transmission of similar vintage, whereas modern foreign vehicles had run multi-cam, alloy engines for years and five and six speed autos were common. Even as recently as only two years ago, that same old obsolete transmission was standard fitment in the cheaper models, many years after is should have been replaced. It has taken too long for our manufacturers to catch up to overseas trends and in many ways, they are still dragging the chain.
I don't begrudge government subsidisation of car makers here and I certainly don't want to see Holden ceasing local design and production and only assembling foreign designs, but the way things are heading, that looks like what the future holds. And that's too bad.
