Mad, bad and sad decisions: Closure of Australia’s car industry

20th October 2017

Reflections on the final shutdown of Australia’s car industry reveal that too many mad, bad and sad decisions were made by politicians and company executives over a period of 25 years.

Australian Democrats’ National President, Elisa Resce, says the principal failure, as with our electricity utilities, was blindly following economic mantras without looking at the potential consequences.

Decisions by both Labor and Liberal governments to slash tariffs as part of attempts to make Australia a world player, without considering the consequences and mitigating against the effects, were ill-advised. Protecting our own became a vilified concept.

The result has been the loss of hundreds of thousands of manufacturing jobs. Australia once manufactured shoes, whitegoods, clothing and lawnmowers. The shutdown of the car industry in Australia is a potent symbol of long term planning failures.

Our leading economists and ‘think’ tanks worshipped at the altar of international trade, where global competitiveness demanded we further reduce tariffs and as a consequence reduce local jobs. Did anyone stop to think what might be required to maintain Australia’s competitiveness in the open market?

Companies relocated their operations overseas seeking cheaper labour (which we know sometimes amounts to slave labour), as well as tax breaks and other concessions, making their decisions without loyalty to their Australian consumers but to benefit their shareholders.

As to the car industry, government failed to look at the long term consequences of their decisions. When tariffs were dropped on some imported SUVs, ostensibly for primary producers, many urban dwellers hopped on the band-wagon thus giving the local car industry a kick in the guts.

Car industry executives also got it wrong. When the economy was trending in a way that would require smaller and more fuel-efficient cars, the local car industry rolled petrol-guzzling 6 and 8 cylinder cars off the production line.

‘It would be a comedy of errors if it was not so sad,’ says Ms Resce.

‘Governments must now face up to the reality they have helped create, and start investigating the broad plan for economic reform that is needed to stem the growing tide of unemployment, and bring manufacturing back.’

 

Further information:

Phone Elisa Resce 0400 466 773

2017-10-20T08:23:14+00:00

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