Action underway to boost car industry

An update on action being taken to boost Australia’s car industry was outlined at a recent presentation in Melbourne to industry representatives.

This follows the 2008 report on the Review of Australia’s Automotive Industry led by the former Premier of Victoria, Steve Bracks, and the subsequent release by the Federal Government of A New Car Plan for a Greener Future.

Under the Automotive Market Access Program (AMAP), which is part of the new car plan, two automotive envoys (John Conomos and Steve Bracks) have been appointed to facilitate Australian automotive access in global supply chains and to lead Australian trade missions overseas. These envoys are assisted by an expanded Austrade adviser network in China, India, Korea and Thailand.

Bracks believes it is critical that the Australian automotive industry is fully integrated in the world market.

"Challenges can be turned into opportunities, including the move to a lower carbon environment. Larger volumes of better and more sustainable vehicles, directed particularly at export markets, are required," he told Manufacturers’ Monthly.

"The industry has a lot of strengths, including government support, but increasingly we will need to compete on our skills and further develop them.

"We can expect the future for the industry to be more internationally competitive, globally integrated and greener. Some smaller automotive component suppliers in particular will need to achieve larger economies of scale and be more export focused in a highly competitive market."

Preparation of an automotive technology roadmap project is also underway to identify and map the industry’s capabilities and needs to 2020 and beyond.

The project, which is being managed by the Cooperative Research Centre for Advanced Automotive Technology, is aimed at allowing the industry to play to its strengths and support innovative technologies with strong commercial potential.

The roadmap is expected to be completed this month, and further information is available at www.autocrc.com.

Marketing support

The AMAP is also providing funding to support Team Automotive Australia (TAA) in engaging a market representative, Terry Barr Sales (TBS), in North America. The company specialises in providing sales, marketing and support services in the global automotive marketplace.

TAA is a coordinated group of world class Australian automotive suppliers targeting the North American original equipment market. The US is Australia’s largest market for automotive components.

Funded by a grant from the Federal Government, it is a joint initiative between the Industry Capability Network, the Federation of Automotive Parts Manufacturers, Austrade and the Governments of Victoria and South Australia.

TBS president, Terry Barr, who was at the Melbourne presentation, says demands on automotive suppliers in relation to quality, price and delivery have increased significantly, so there is a greater need for strong market representation.

"Suppliers must have a good understanding of customers, global competitors and the market, so we provide a range of services including market and competitor assessments, identification of targets and objectives, and development and implementation of sales strategies," Barr told Manufacturers’ Monthly.

"The automotive industry in the US has been hit hard by the global financial crisis, with unemployment in Detroit running at around 15%. At the same time however, significant changes are taking place in the industry.

"Environment was clearly the number one theme at the recent North American International Auto Show in Detroit, with a strong trend to smaller vehicles and hybrid electric technology.

"Gas guzzling SUVs and V8 engines are on the way out and there is a growing focus on 4 and 6 cylinder engines."

Barr points out that each automotive industry supplier needs to develop its own marketing plan, because each company is a different animal.

"The main factor that makes a company better than another is management’s dedication to a specific market – a lot of commitment, effort and vision is required to achieve real success," he said.

"The role of TAA can include protecting an Australian supplier’s business in its home market. Even if your company does not export, many Australian suppliers are shipping locally to global customers such as Toyota, Ford and GM or to Tier I and Tier II global customers in Australia.

"If you supply locally, but your customer is global in nature, you are at risk," Barr said.

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