In the midst of the struggle being faced right now by the Australian car industry, the Australian Manufacturing Workers’ Union (AMWU) has asked the Federal Government to abandon its plans of taking off $2 billion from co-investment if elected.
In their website the Union says the plans to slash from co-investment will be a “big body blow” to the already ailing car manufacturing industry that is being subjected to difficulties due to the high Australian dollar and subsidized imports.
AMWU National Vehicles Division Secretary Dave Smith said the 500 job cuts which was announced last week by Holden should only add a sense of urgency on the part of the Coalition to adopt a clear policy that will support co-investment. This is to assure and give car makers like General Motors, Ford and Toyota the long term certainty that they need to keep manufacturing cars in Australia.
“Our members know you cannot afford a short-term approach, stripping back co-investment as a cash cow to fund election promises, when the future of 200,000 jobs in manufacturing and car components rides on it.”
“Our members who choose to take a package will be provided with formal opportunities to re-train and fully supported while they do so,” said Smith, who thinks the job losses must be “operationally justified” to ensure that the remaining workforce would be able to cope.
Smith also said Holden needs to be assured that the $275 million co-investment will be there if the car manufacturer will allot $1 billion to produce two new models and extend production beyond 2020.
“The real challenges facing our industry can’t be blamed on the workers or co-investment,” he said.
“We are facing import opposition of cars from nations that don’t hesitate to massively subsidise their vehicle makers or to keep down the value of their currency.”
Smith believes co-investment is not really the problem of the industry. According to AMWU, Australia’s subsidies sat at only $18 per person per year, compared to $90 in Germany and about $260 in the US, where GM and Ford have their headquarters. Holden has in fact placed $32.7 billion into the economy in the past 12 years for government funding of $1.8 billion.
However, the rising Australian dollar has increased costs for the local car makers by 60 percent.
In 2012 the sales of the Holden Cruze had fallen by 13.7 per cent, causing a need to cut production at Elizabeth plant from 400 cars to 335 a day.
“If any government phases back co-investment the industry can’t exist here without some kind of added tax on imports to allow Holden, Ford and Toyota to compete fairly,” said Elizabeth plant delegate Heinz Joham, who also shared that members are “enormously frustrated” with Free Trade Agreements.
“We still build quality vehicles here and we have faith the new VF Commodore will sell well, but our governments must do their bit.”