The automotive manufacturing industry is one of Australia’s major manufacturing sectors. It is a strategically important part of the Australian economy in terms of the investment, jobs, skills, research and development, innovation and exports it generates.
The Australian automotive manufacturing industry comprises three vehicle manufacturers and approximately 150 component, tooling, design and engineering firms who are registered for the Automotive Transformation Scheme. The three car manufacturers - Ford, Holden and Toyota - are subsidiaries of overseas parents. Many, but not all of the supplier companies are also subsidiaries of global corporations. The industry employs people in every state in Australia.
Research and development (R&D)
R&D in the automotive manufacturing industry benefits the entire economy, through the industry's extensive linkages with other sectors, such as heavy engineering, marine and aerospace. The motor vehicle and motor vehicle parts manufacturing industry spent $693 million in 2011-12 on R&D.
Industry value added
The automotive manufacturing industry’s value added was $5.4 billion in 2011-12, or 5.3 per cent of industry value added for the manufacturing industry.
Automotive industry employment
The automotive industry is a major employer in Australia, with over 42,000 people working in the motor vehicle and parts manufacturing sector alone as at August 2013.
New vehicle sales in Australia for 2012 were 1,112,032 units, a rise of 10.3 per cent from the previous year. Sales of Australian-made vehicles in 2012 totaled 141,435, down 0.9 per cent on 2011. The market share of locally produced vehicles was 12.7 per cent, down from 14.1 per cent in 2011.
The Australian automotive manufacturing industry is a major export industry. The value of Australian automotive exports in 2012 was $3.7 billion. Of this, $2.1 billion was motor vehicles and $1.6 billion was automotive components. The majority of exports go to the Middle East and North America.
While Australia’s automotive exports are down from the (pre-global financial crisis) record high of $5.8 billion in 2008, they still account for around 13 per cent of total exports of elaborately transformed manufactures (ETMs). The industry is also a major user of ETMs in the manufacturing process. For example, the industry uses high-technology capital items such as robots in manufacturing vehicles and parts.
Changing consumer preferences
While the sector has enjoyed a solid performance in export markets, (notwithstanding the impact of the GFC on demand) its share of the domestic market has fallen from 30.2 per cent in 2002 to 12.7 per cent in 2012. This is indicative of a long term consumer trend towards smaller, more fuel efficient cars and small or luxury SUVs. This is away from the larger cars traditionally produced in Australia. The local motor vehicle producers have responded to this trend and have all recently introduced more fuel-efficient and environmentally-friendly vehicles.
Locally-produced vehicles still accounted for four of the top 10 selling vehicles in Australia in 2012.