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Are Government Subsidies Wasted on a Dying Industry?

Posted: November 5th, 2013 | Author: | Filed under: Business News | Tags: , , , , , , , , | Comments Off on Are Government Subsidies Wasted on a Dying Industry?

Are Government Subsidies Wasted on a Dying Industry?With car production volumes falling to 5 year lows, and on a steady decline, the big question on the lips of auto industry insiders has got to be Are Government Subsidies Worthwhile. Is  it truly worth forking out billions of dollars to sustain an industry that is seemingly on it’s way out?

The Federal Chamber of Automotive Industries – FCAI – reckons they are, it thinks a report showing dire economic consequences if the car industry collapses in Australia will change many people’s views, and hopefully give a final answer to a question that has hung like a noose over Australia’s car-making industry.

The report was compiled for the FCAI by the Allen Consulting Group and Monash University researchers. Automotive production is at close to half the level it was in 2008 when Australia turned out 320,000 cars, this year however the industry might produce as few as 180,000 units.

The standard, and seemingly logical, argument that Australian tax payers shouldn’t be propping-up US companies almost entirely negates the 40,000 strong workforce involved directly in car-making and almost the same again in ancillary industries, it also fails to take into account a contribution close to $25 billion a year to the nations economy ::  Read the full article »»»»


Fords $AU100 Million Dollar Government Gift Equates to 400 LOST JOBS

Posted: July 21st, 2012 | Author: | Filed under: Business News | Tags: , , , , , | Comments Off on Fords $AU100 Million Dollar Government Gift Equates to 400 LOST JOBS

Ford Celebrates Launch of 2012 Ford FocusIn January this year we wrote – The Cost of Keeping Auto Makers Local – as sales of Australian made large cars – GM Holden Commodore and Ford Falcon – dramatically dropped the auto makers stood in line for serious government financial assistance. GM’s Commodore 15-year run as Australia’s best-selling vehicle was ended abruptly in 2011 by the Japanese manufactured Mazda3, while Ford Falcon sales plummeted to fewer than 19,000 units in 2011.

In May we questioned the validety of Australian Government subsidies granted to the nations 2 big auto makers – General Motors & Ford – The Cost of Keeping General Motors ‘Holden’ Local, And asking the question: So Exactly How Much Does it Cost to Keep Auto Makers in Australia? At the time, the Australian Government answered the question by handing General Motors Holden more than $AU275 Million to help keep auto manufacturing in Australia.

Ford Australia in the last few days has shockingly announced the loss of 440 jobs in it’s Victorian plants.

In the case of Ford, the Australian Government granted the company $AU103 million in subsidies with the promise of  plant – Geelong – upgrades and the longevity of Fords large sedan the Ford Falcon. Right about now the Federal Government, and Prime Minister Julia Gillard must be wondering if they’d simply thrown good money after bad, with Ford announcing that it will shed 440 jobs?  :: Read the rest of this entry »


AUSTRALIA: The Cost of Keeping General Motors ‘Holden’ Local

Posted: March 25th, 2012 | Author: | Filed under: Business News | Tags: , , , , , , | Comments Off on AUSTRALIA: The Cost of Keeping General Motors ‘Holden’ Local

General Motors HoldenBack in January we posted ‘The Cost of  Keeping Automakers Local’ Reporting that sales of the Australian made large cars – Holden Commodore and Ford Falcon – had dropped alarmingly in recent years. The Commodore’s 15-year run as Australia’s best-selling vehicle was ended abruptly in 2011 by the Japanese manufactured Mazda3, while Ford Falcon sales plummeted to fewer than 19,000 units in 2011.

And asking the question: So Exactly How Much Does it Cost to Keep Auto Makers in Australia? This past week Australian Government has answered the question by handing General Motors Holden more than $AU275 Million. The Australian government reckons it has avoided a “knockout blow” to the manufacturing sector by giving $215 million in assistance to General Motors Holden. The car maker will also receive $50 million from the South Australian Government and $10 million from the Victorian Government. Read the rest of this entry »