BUS201 Business Essay

Submitted By rogerang49
Words: 1574
Pages: 7

Australian Car Manufacturing Industry Current Position
Australia is a car production nation that is invest by a few big major car manufacturer that operating car manufacturing in Australia. Australia are capable to design and build a car from scratch and produce in volume there are only a few countries in the world that are capable to do that. But unfortunately Organisation Internationale des Constructeurs d’ Automobiles (OICA) or better known as International Organization of Motor Vehicle in the world, OICA concluded that in year 2014 Australia manufacturing industry has drop by 13.6% as a result the giants in the car manufacturing industry to withdraw from Australia industry (OICA 2014). According to Schneiders and Lucas news report that giants such as Ford , Toyota and Holden reported a loss of a total more than 320m in Australia market and plan to withdraw by the end of 2017 from Australia market in “Era of the Aussie car over” (2013). According to Beissmann, he calculated that car manufacturing in Australia is worth around 21.5 Billion (AUD) and the impact of this industry withdrawing from Australia will increase atleast 39000 of unemployment rate by the end of 2017, he also highlight a statement made by Monash University policy consulting group that these giants only receive 500 million (AUD) a year from the government as subsidy but contributing 21.5 billion (AUD) every year to the Australian Economy and furthermore Australia’s gross domestic product would most fall 7.3 billion (AUD) in year 2018 estimated by the expert explain that the consequences if car manufacturing industry withdraw from Australia (2013).In year 2018 the industry may collapse due to the car industry. In 13 countries around the world Australia is one of them. Holden, Ford and Toyota will be the leading the industry. Australia comes third in the world where the ratio of population which is approximately 20million where the country has approximately 15million registered motor vehicles. The competition between those giants is one the reason that effect on the drop of the car individual sales.
Auto-Mobil manufacturing industry used to hit the peak during early 70s’ hitting 10th in the world back then, during that decade the amount is very close to double the previous decade (Matthew 2013). The result of the decade attract car manufacturing giants to invest in Australian market and this is how Australian car manufacturing industry became one of the most important industries in Australia. In year 2012 unfortunately the number of Australian manufactured car is less than 210000, this result the giants (Holden, Ford and Toyota) to withdraw from the market partly because the government wasn’t giving out subsidy to cover the losses. This decision made by the giants will result that in year 2017 there will be no more Australian manufactured car as the giants did not even request financial support from the central government after they announced that they will no longer operating their industry in Australia (Wallace and Ferguson 2014). During a campaign Australia current prime minister said that if Australia is going to lose the car manufacturing industry, Australia will suffer from being to maintain the first world economy (Carlton 2014).
According to the report made by Weber, he stated that Australian car manufacturing industry is producing rate is below the basic level to sustain it operating cost but with such a big number of competition each car manufactured are facing, this lead the car market to diversify (2014). Australia is a fair and free country where competition occurred but without the government control foreign car manufactured can import their motor vehicles into Australia market with low-tariff on top of the products which lead to more option for the people staying in Australia to purchase. On the other hand, Australian government had signed the free-trade agreement with the United States and South Korea which allowed them to sell their