Ricky Muir (Victoria, Australian Motoring Enthusiast Party) Share this | Hansard source

I rise to speak on this general business notice of motion in relation to the Automotive Transformation Scheme. I hope that all my Senate colleagues note the importance of the Automotive Transformation Scheme to local jobs and the local economy. As we just heard, there is a very good chance that we may lose 100,000 jobs in my home state of Victoria and more flowing on through South Australia and so on. I hope that my colleagues do not just notice the importance of the Automotive Transformation Scheme but also what it can achieve today and how it can be adapted to seize opportunities into the future.

We are all well aware that this scheme is critical to ensure the viability for not only the new vehicle producers—Ford, Holden and Toyota—who are winding up their major manufacturing operations in Australia, but the current scheme is also essential to supporting the component, tooling and service producers who are part of the supply chain affected by the departure of these major manufacturers. I am calling on the government to recognise the opportunities to transform the industries in these areas outside of the current scope of the scheme.

Some may be aware of the Automotive Diversification Program and would argue that this is the place for what I am about to call for. Based on industry feedback, the Automotive Diversification Program is limited in its scope and not really fit for purpose. Rather than having two funds which are not really targeting the opportunities before us, should we not consider reducing red tape and roll both programs into a single expanded scheme?

The Automotive Transformation Scheme could be expanded to not only provide the necessary support required now but also seek to invest in the opportunities the scheme does not capture currently. We still have time to better engage with industry and redefine an appropriate scope that maximises the opportunities for local manufacturing and local jobs in Australia. We need to diversify the Automotive Transformation Scheme to cover not only what the poorly defined and implemented Automotive Diversification Scheme attempted to achieve but listen to those who are looking to start up a new and unique automotive manufacturing offering.

Companies such as Applidyne are seeking to develop a new car to a specific market segment. They wish to utilise our local skills in car design and manufacturing. They plan to develop a SUV for the Australian market. They see their target market as the off-road enthusiast. What makes their offering unique is that they are looking to develop an electric off-road vehicle. This company has the local Australian intellectual property necessary around transmissions and suspension design and they are intending to partner with other local industries as necessary. Right now Australia has the capability in car manufacturing that they can access, but for how long under the current government policy?

Applidyne are seeking to create local jobs using a local management and design team with a track record in technology development and commercialisation. Whilst initially starting with a donor vehicle similar to how Tesla started with the Lotus so they can focus on the drivetrain and suspension, in the longer term they are looking to develop a whole vehicle with Australian skill, facilities and suppliers. Their economic modelling suggests that this program will create at least 6,000 direct jobs and 30,000 indirect jobs over 10 years, with export revenue of $3.5 billion per annum in year 10.

All Applidyne is seeking from the government is an investment of $150 million. This $150 million could go towards potentially soaking up some of those 100,000-plus jobs which may be lost in Victoria. They are excluded from the Automotive Transformation Scheme as they are a company in start-up phase and cannot claim their research and development until they are registered as a motor vehicle producer. Applidyne have made representations that the automotive transformation scheme should be amended to support research and development for both existing and start-up automotive companies, and I would be inclined to agree. This is simply one example.

Recently there were media reports about another start-up, Ethan Automotive. They have also been seeking to manufacture an Australian family SUV to fill the void left once Ford, Holden and Toyota depart. Their unique selling point is around their local manufacturing process that will utilise a modular chassis that can be used across three different models.

According to the industry minister, he is of the opinion that industry is not asking him to change the guidelines. His argument is that they are tried and proven. The industry is definitely asking for him to change the scope. However, evidence presented to the Senate inquiry by Applidyne and others about the future of Australia's automotive industry would appear to contradict what the minister is suggesting.

We also have an aftermarket industry that is alive and well and begging for investment. It is a part of the automotive industry that is ready to expand and redeploy some of the skilled workers who will be left jobless when Holden, Ford and Toyota depart. The aftermarket industry has called for the ATS to be adjusted to allow the industry to expand. This expansion will not only help fill the void but also focus on opportunities to export Australian manufactured products overseas. With the inquiry due to deliver its interim report soon, I would hope that there would be a recommendation to alter the scheme to take advantage of these opportunities for economic growth. Of course a recommendation is only a recommendation and I would then hope that the government would act on it appropriately. The aftermarket industry not only struggles to receive any sort of government support to grow its export business but its domestic business is constantly under threat from bureaucratic red tape in Australia.

The federal government has gone to great lengths to harmonise our Australian Design Rules with many other countries for newer manufactured and imported vehicles to ensure easy importation, certification and trade. However, state and territory government bureaucrats cannot work together to recognise a common set of modification standards across our own borders based on these standards. The federal government has provided a set of common modification rules to adopt in the form of the National Code of Practice or NCOP. It is not uncommon for modified vehicles to be driven from one state to another state, be defected and the driver fined simply because the modification rules are different between states. Even after recent changes to the Australian Design Rules to recognise developments in technologies, such as LED light bars, the states are not able to agree on how these are to be mounted or used on a vehicle.

A local aftermarket manufacturer, ARB, has developed a four-inch lift kit for the Jeep Wrangler. It has been extensively engineered and tested to meet safety requirements in Australia. It appears, however, that it can only be legally fitted in Victoria and New South Wales. This is an Australian developed, legally and professionally fitted aftermarket product. A family on a 4WD tour holiday outside of Victoria or New South Wales with this aftermarket product fitted risks being defected and fined for driving over a line on a map, an imaginary line. There is also a risk that they are not insured outside of their home state as the modification is classified as illegal by the local jurisdiction they are visiting.

You can have a legal type of motorcycle helmet in Victoria or Queensland that complies with the required standard there, but cross into another state and chances are that, if it complies with the European standard and not the Australian one, you will be fined. This is absolutely ridiculous and lacks common sense.

I use this opportunity to highlight to various bureaucracies the harm that they are doing to consumer confidence in the domestic automotive aftermarket industry. Motoring enthusiasts have a passion for customising their vehicles and they have the funds ready to invest in the aftermarket industry. But first they need the confidence that they will not be unfairly targeted by law enforcement and possibly have their insurance voided because laws governing the use of aftermarket components are inconsistent between the states.

In conclusion, not only does the federal government have an obligation to listen to the evidence presented from industry and adjust the rules of the ATS to better capture the opportunities presented but, likewise, the states have a part to play by introducing consistent vehicle modification and safety laws to help ensure the future and growth of the Australian aftermarket automotive industry.