Stephen Parry (Tasmania, Liberal Party) Share this | Link to this | Hansard source

My question is to the Minister for Innovation, Industry, Science and Research, Senator Carr. Given the ongoing haemorrhaging of thousands of jobs in the Australian car industry, why won’t the government do what the coalition, industry and the unions are calling for—that is, immediately bring forward an assistance package for the sector?

Kim Carr (Victoria, Australian Labor Party, Minister for Innovation, Industry, Science and Research) Share this | Link to this | Hansard source

I thank the Senator for his question. I think we would all agree, the situation in the automotive industry is particularly troubling. We all acknowledge that the automotive sector is facing exceptional difficulties as a result of the international conditions. I understand that reports in the press today highlight the concerns of manufacturers—both direct manufacturers and suppliers.

Ford has confirmed that it will be laying off more workers, but it has yet to indicate exactly how many. The company has indicated that it will be making a statement this afternoon. I understand that statement will be made at 3.30 pm. Holden is planning more down days between now and the new year, and the Federation of Automotive Parts Manufacturers has warned that there could be significant job losses in the component sector if the right decisions are not taken now.

This is precisely why the government are taking decisive action to support this industry and every other Australian industry sector by increasing the liquidity and the stability of the financial system by putting together a $104 billion economic security package to keep the economy growing. That is precisely why we commissioned the Bracks review and that is why we are drawing up what we have done in terms of the most comprehensive industry plan ever devised for the automotive industry in this country.

The industry and its workers are performing incredibly well, given the intense pressure that they are all under. In the year to August, over 63,000 people were employed in the car industry, representing some six per cent of the manufacturing workforce. Automotive exports rose 20 per cent to $5.6 billion last financial year. The latest research and development figures from the ABS show that spending on automotive research and development rose from $761 million in 2005-06 to $848 million in 2006-07. That is an increase of 11 per cent. So while it may be the case that those opposite are seeking to drive down this industry, we have to bear in mind that there are enormous opportunities for future growth in the industry.

Vehicle sales are down, but we have not seen anything like the falls that have been experienced in Europe and the United States. The industry is committed to new investment, with Holden ramping up its export program, with Toyota producing the hybrid Camry in Australia from 2010 and with Ford to produce the four-cylinder Focus from 2011.

There are few industries anywhere where more resilient, capable and creative people are working than in the automotive industry. It is the cornerstone of Australian manufacturing and it is now battling what are the most hostile operating conditions we have seen for decades. Many of the problems facing the industry have been a long time in coming, and those opposite did nothing about it. They have left this industry on automatic pilot since 2002. The global financial crisis has compounded those problems. Car makers, like those in other parts of manufacturing— (Time expired)

Stephen Parry (Tasmania, Liberal Party) Share this | Link to this | Hansard source

Mr President, I rise to ask a supplementary question. I thank the minister for confirming the great legacy the Howard government left for the car industry and ask the minister: is the delay in acting simply because of the low priority that the Labor government gives to the car industry and the car workers or is it simply reflective of budgetary pressures?

Kim Carr (Victoria, Australian Labor Party, Minister for Innovation, Industry, Science and Research) Share this | Link to this | Hansard source

I have indicated that we are drawing up what will be the most comprehensive industry plan ever devised in the automotive sector in this country. That is what this government is doing. We are consulting thoroughly, widely and comprehensively to ensure that we do have the answers to deal with these questions.

Car makers, like many other manufacturers, are finding it hard to raise capital. Last week we saw the United States stock market value General Motors in US dollar terms at $2.7 billion. That is less than the market capitalisation of Crown Casino, at US$3.3 billion. That kind of irrationality cannot last forever and it is essential that we keep preparing for the future. The industry understands that, the government understands that and together we will steer this industry through the most difficult times— (Time expired)