The Australian car industry will not survive the downturn, expert says

[DanielXR8]

From news.com.au. I think what he is saying is certainly possible and it would be naive to say it couldn't, but it would have been nice if the reporter had asked some other industry pundits like part suppliers and ex auto executives to comment on this for some more balanced thoughts to go with the headline.

Dan

The Australian car industry will not survive the downturn, expert says

AAP

April 14, 2009 07:27am
AUSTRALIA'S car industry will not survive the economic recession, and Holden will probably be the first to go, an industry expert says.

Editor of the car buyers Dog & Lemon Guide, Clive Matthew-Wilson, said the Australian car manufacturer is poised to shut down for good because it can no longer compete in the global market.

Holden signalled the beginning of the end when it recently halved production at its South Australian plant, he said.

In early April the company announced that from May 4 it will reduce production at its Adelaide plant from about 600 vehicles a day to 310, citing reduced demand in domestic and export markets.

"Australia's car factories are losing money on every vehicle they make," Mr Matthew-Wilson said in a statement.

"No amount of incentives from the state and federal governments can solve this basic problem.

"It's not a matter of whether they close down, but when they close down."

He said Holden will be the first to go, followed by Ford and then Toyota.

"People falsely believe that Ford is doing okay. That's not true," he said.
Related Coverage

* Reader's Comments: Holden is doomed, says expert - The Courier-MailCourier Mail,
* Federal fleet car shockHerald Sun, 6 Apr 2009
* Obama axes GM boss, but hope for HoldenHerald Sun, 2 Apr 2009
* Toyota to build 4WD in AustraliaNEWS.com.au, 4 Mar 2009
* Rudd ads smile through job cutsThe Australian, 28 Jan 2009

"American Ford's sales are down 43 per cent in the first quarter of this year.

"Ford is losing billions just like GM; it's just that Ford arranged private sector finance before the recession, so it's not quite so obvious how serious things are."

Amid the financial turmoil, the big three US car makers - Ford, Chrysler and Holden owner General Motors - have asked the US government for a loan guarantee of $US25 billion ($37.51 billion).

Earlier this year Toyota, the world's No.1 car maker and Australian market leader, accepted a $35 million federal government grant to build a hybrid version of its four-cylinder Camry sedan in Melbourne from 2010.

But Mr Matthew-Wilson said the money is a waste.

"Globally, there's a glut of new cars at bargain prices, yet Australia, which produces a small number of high cost cars, is trying to compete with countries like China, which produces ten million cars a year and pays its car workers as little as one dollar per hour.

"The Australian government can throw $6 billion or $600 billion at these car plants, but they still won't be economically feasible," he said.

"Australia's car plants are losing money faster than a drunk at a casino and there's no feasible way of turning this around.

"The Australian car industry can re-focus on small cars, green cars, blue cars or red cars. None of this will make the slightest difference."

Mr Matthew-Wilson believes the government money would have been better spent by giving it to the affected car workers.