By Paul Hemsley
Federal Minister for Industry and Innovation Greg Combet has attacked state and local governments for not buying enough Australian-made cars for their vehicle fleets, suggesting that 70 per cent of local government purchases come from foreign manufacturers.
Mr Combet’s sharp criticism over the low purchasing rate of locally-made cars comes as Ford Australia prepares to eliminate 1,200 jobs after it announced last month that that it will close its Australian manufacturing plants in October 2016.
“In 2011-12 over 70 per cent of all passenger vehicles purchased by the Commonwealth, Victorian and SA Governments were made in Australia – by contrast Australian-made cars made up just 40 per cent of vehicle purchases for the other States and Territories and only 30 per cent for the local government sector as a whole,” Mr Combet said.
Ford’s decision to close local factories has big consequences for all levels of government that have to deal with issues like labour related population movements and keeping manufacturing dependent communities viable.
The federal and Victorian governments have announced that they will together contribute almost $40 million to “structural adjustment programs” to support the “economic development and diversification” of the Geelong and northern Melbourne regions where the Ford workforce mainly resides.
The announcement from Ford echoed a similar announcement from Holden in April 2014 that revealed it would reduce its workforce, which South Australian Premier Jay Weatherill contested as a breach of agreement between the company and the state government that ensured minimum employment levels to create an efficient auto-manufacturing industry until at least 2022.
Mr Weatherill then made a resounding push to the federal government to embed Australian made cars into public sector procurement plans for fleet purchasing to boost struggling local automotive manufacturers.
The risk of a failing auto-manufacturing industry in Australia then prompted Mr Combet to meet with leaders at Toyota, Ford and Holden as well as union leaders and representatives from the South Australian and Victorian governments to discuss the potential consequences of industry’s decline as well as possible solutions.
Mr Combet emerged from the meeting with the key stakeholders revealing that the local government sector as well as the New South Wales, Queensland and Western Australian governments have been buying “significantly lower” proportions of Australian-made cars than the federal government and the Victorian and South Australian governments.
The Victorian and South Australian governments have prioritised the purchasing of Australian-made cars for their fleets because of the substantial stakes the industry has in those particular states.
Mr Combet said the Commonwealth has moved to buy more Australian-made cars after strengthening its Fleet Vehicle Selection Policy in 2012 to require departments to select Australian-made passenger vehicles, unless there is a genuine operational requirement.
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