Objective
To enhance the long-term sustainability and international competitiveness of the Australian automotive industry in the context of trade liberalisation and the Government’s announcement that transitional assistance to the industry will cease in 2015.
Significance for Australia
The automotive industry is one of Australia’s major manufacturing sectors. It accounts for approximately six per cent of the total value added in manufacturing, and almost one per cent of Australia’s gross domestic product. More than one third of the 328,000 vehicles manufactured in Australia in 2007 were exported.
The Australian automotive manufacturing industry comprises three vehicle manufacturers and more than 230 component, tooling, design and engineering firms. The three car manufacturers are subsidiaries of overseas parents. Many, but not all of the supplier companies are subsidiaries of global corporations. The industry employs around 60,000 people. It is one of the country’s largest export industries, ahead of traditional commodities such as wheat, wool and beef, with exports worth over $5 billion.
Departmental role and current achievements
The Department advises the Australian Government and develops and implements policies which promote the competitiveness of the Australian automotive industry through a transition to lower tariffs and assistance. Strengthening the linkages between Australian-based firms and the global industry is an important part of this approach. The Department also conducts research and analysis to underpin policy formulation and evaluation, including the electronic publication of Key Automotive Statistics. It provides advice on general automotive trade issues, including advice on the implications for the automotive industry of proposed Free Trade Agreements.
Established by the Department, the Automotive Competitiveness and Investment Scheme (ACIS), commenced in January 2001. On 13 December 2002, the Australian Government announced a policy package for the automotive industry which will run to 2015. Under the package, ACIS will be available to the automotive industry until 2015 at an estimated cost of $4.2 billion. This will facilitate adjustment to a lower tariff environment. The automotive tariff on passenger vehicles reduced to 10 per cent on 1 January 2005 and will fall again to five per cent in 2010. The Department will be responsible for implementing these arrangements.
On 14 February 2008, the Government announced a review of the automotive industry. The Minister's media release and Terms of Reference for the review are available here.
Targets for 2008-09
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Participate in the 2008 review of automotive assistance
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Provide policy advice on automotive issues
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Ensure the successful implementation of ACIS stage 2
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Promote increased access to international markets for Australian motor vehicle producers by providing advice on implications for the automotive industry of proposed Free Trade Agreements
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Produce the publication 2007 Key Automotive Statistics
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Support Australia’s participation in the APEC Automotive Dialogue
For further information
Phone: +61 2 6213 7088
Email: inquiries@innovation.gov.au
Web: www.innovation.gov.au
May 2008