Australian Automotive Industry Essay

After WWII the Australian government saw huge potential for job creation and skill retention in the automotive industry, however due to the vast amounts of imports of imported vehicles the Australian Government began to enforce a customs duty tax as well and implementing heavy tariffs on the vehicles imported, therefore this encouraged domestic manufacturers to produce vehicle in Australia. Over the years, the Australian Government has protected the Australian motor vehicle Industry various times and in various ways. They consistently set a minimum level of local content requirement and always imposed import quotas and tariffs on foreign vehicles (Australian Bureau of Statistics 2005). This encouraged the domestic industry to build up over …show more content…
The extremely high tariffs that were at one point 57% were decreased to 15% in 2000, then 10% in 2005 and ultimately down to 5% in 2010. (Australian Bureau of Statistics 2005). By imposing high trade barriers for foreign manufacturers in the past, the government allowed the domestic automotive industry to feel secure , ultimately making those companies uncompetitive within the domain of the global market as the reliance on government subsidies was excessive. Despite the decrease in government subsidies , they still provide assistance to domestic manufacturers such as regular budgetary assistance. According to the Productivity Commission (2010, p. 120), total budgetary assistance to the Australian automotive industry in 2008-09 was $573.3 million. This kind of contribution provides them with an upper hand in the market and gives them space to grow stronger for the global market. Other government assistances are also available such as "A New Car Plan for a Greener Future" plan. The objective of this plan is to help the Australian car industry in the research and development sector to produce low carbon emitting vehicles which will also fortify the local supply chain and increase foreign