Australian PM seeks Toyota talks to save car industry

Holden received billions of Aus $ for years form the government to try to help keep it aloat, and it still couldn't make it.

Why is it that Toyota survived without these subsidies yet holden and ford could not?

Now they deciding to give that squandered money to Toyota to keep it afloat, perhaps the aus car industry is broken and they should import more cars from factories in japan.

Most of the problems are stemming from rediculous import taxes. When there is such a markup it isn't feasible to import cheaper good and then subsequently allow for export. By having such a big tax barrier it creates a micro market which just simply doesnt have the population to sustain. They just need to take less tax from imports/exports and open up trade to the world economies. And help Aus Post stay a bit cheaper too.

Most of the problems are stemming from rediculous import taxes.

Surely the purpose of the high import taxes was to make domestic manufacturing more feasible, not less. With lower taxes the onshore car production would have disappeared sooner.

@StormR

To date, Toyota has also receive somewhere in the ballpark of $1.2bn in govt funding. I doubt they'll manufacture in Australia for much longer - and I don't blame them.

The reality is, Australia is one of the toughest markets in the world. Small population, high wages, very powerful labour unions. Add in the fact that both Holden and Ford failed to deliver on "green" cars (and associated innovation), and this was never going to be a sustainable business. As an Aussie who has owned both Holdens and Fords (still have my '85 a Fairlane ZL back home!), it's heartbreaking.

No amount of money or even Son of God can save the Toyota for not saying Sayonara to Australia. Currently Toyota is exporting middle east from Au for replacing local losses. The biggest hurdle for them is efficient and reliable supply chain.

For many car parts suppliers, it is not economical for supplying only left over one company. If Toyota has to import from oversea, there will be high logistic and transportation cost. Au population is 23 millions many times less than US or UK or Japan. however PM Abbot pay is three times more than US president or UK PM. The same theory applied to unskilled Au factory workers. It is unreasonable and unrealistic.

High court of Au has rejected Toyota new structure change of cost cutting and efficiency. It is like a blow of Toyota face. It is not encouraging for the last car maker. Toyota needs to follow Nissan for expanding market in elsewhere which is promising. Nissan is booming in China. Toyota is dooming in Australia.

Jay O-H

Most of the problems are stemming from rediculous import taxes*.

Automotive industry assistance is now modest and transparent. Let's be clear: every car-making nation supports its industry and at a far greater level than Australia. In the US it is $264 a person, in Germany $90 a person and in Australia just $18. Today, tariff protection is at 5 per cent, a fraction of what it was in the early 1980s. Because Australia has entered into free trade agreements with other car-making countries, this tariff does not even apply to many imported vehicles.

From: http://www.theaustralian.com.au/national-affairs/opinion/fate-of-holden-up-to-abbott/story-e6frgd0x-1226780117064#

Unions have warned of a multi-billion-dollar hole in the economy and the loss of up to 50,000 automotive industry-related jobs if car manufacturing in Australia ends altogether.

Holden's closure will result in about 2,900 layoffs. As Toyota is the only remaining manufacturer in Australia, are the unions claiming Toyota's workforce in Australia is 50,000? I somehow doubt that. They're probably including all the employees at companies that supported the manufacturing plants. Those companies will find other customers to work for, just not in the automotive industry.

Unions are almost a comedy act. They extort concessions from their employers (yes, a strike is a form of extortion: "Give us what we want or we will force you to lose revenue"), resulting in less productivity and profitability. They look to unnecessarily pad their union rolls - increasing the wage and salary costs for the company for little-to-no increase in productivity - AGAIN resulting in less profitability for the company. After all that, they issue "warnings" about what will happen to the economy if the company closes shop. If the lives their actions affected were only union lives, then I'd laugh at their comedy act. Because many more families besides union families are affected when a company closes, however, I'm not laughing.

Toyota has a great opportunity to reign in cost with unions. Australian government should and must subsidize Toyota in dealing with demands of unions. If not, they should leave. If Australian government doesn't step up to plate, it'll just be another Detroit in the making.

I am fairly confident that Tony Abbot and the majority of his Liberal party mates are not driving Toyotas.

@Most of the problems are stemming from rediculous import taxes. actually its the other way around, with import duties at 40% 20+ years ago its been slowly reduced down to 5% now. so imported cars are actually cheaper than theyd be many years ago (taking inflation into account) the main reason is the ridiculous labour cost, the minimum fulltime week wage in Australia is now about $650 a week about $16/hr , 58,000yen/1400yen, and thats the minimum, auto workers with the unions having a big say in those companies get around 50k 4.5million a year. add to higher overtime rates penalty rates etc you can see that its just too expensive making cars there.

The high wage in Australia is the answer for high cost of living . Only food is cheep .Housing, medicine, transport, education ,lawyer's fee, government tax..etc... all expensive. Globalisation creates so many good and bad things that Australia is still trying to adopt.