Ford, Toyota echo Holden's call for government assistance

The bosses of Ford and Toyota have echoed Holden’s call for renewed Federal Government assistance after $800 million of funding was withdrawn nine years before it was due to expire.

Last week Holden boss Mike Devereux made headlines after explaining in blunt terms that local car making is dependent on Federal handouts.

It has now become apparent that when the Federal Government prematurely ended the $1.3 billion Green Car Innovation Fund, it sent shockwaves to the head offices of the three local car makers in Tokyo and Detroit.

Spooked by the sudden policy shift Devereux conceded General Motors was reviewing the future of Holden’s local car-making operations.

Speaking at the Melbourne motor show, the bosses of fellow Australian car makers Toyota and Ford told motoring.com.au they needed clarity in the level of government funding five to 10 years from now.

It is the first time all three manufacturers have publicly expressed concerns about the viability of local car making since Mitsubishi shut its Adelaide factory in March 2008.

Toyota’s executive director, sales and marketing, David Buttner, told motoring.com.au: “The scale of automotive manufacturing in this country needs a policy framework in place that gives the parent [company] – the primary investor – medium to long term horizons to ensure they can get a return on that investment.

“We have to have a policy framework which makes it conducive to sustain manufacturing in this country and … if you spoke to any automotive executive in any country in the world they’d be saying the same thing because you have to be able to see what’s down the track [and] understand the policy.

“The decisions that we make are high on investment and long in terms of time, so those horizons are really important.”

Buttner said Toyota’s operation in Altona (pictured) on the outskirts of Melbourne was not just competing with the other local car makers, but seven other Toyota factories around the world that make the Camry – including neighbouring Thailand. 

“We compete within our own company for volume and product in the Asia Pacific region. As a manufacturing entity within the Toyota group we have to continue to prove we can build cars with the right productivity, efficiency and quality – and compete from a cost point of view.

“We want to build cars [in Australia], we want to continue to be a major employer, we want to continue to partner with Australian suppliers so they have longevity in the marketplace.” But, Buttner said, there needed to be a consistent assistance package to make local manufacturing viable.

“We’ve … demonstrated our commitment to the market. We’ve just invested $300 million in a new engine plant for [next generation] Camry and hybrid Camry. That plant will be on stream for the last quarter of next year. Our next generation Camry is still on schedule in spite of some of the difficulties we’ve had over the last few months.

“So I think that speaks volumes about how serious we are about continuing to build cars in this country.”

But, he added, car makers can’t fund local manufacturing operations on their own, especially given the competitiveness of Toyota’s Camry factory in Thailand, which has a free trade agreement with Australia.

The president and CEO of Ford Australia Robert Graziano told motoring.com.au: “We just want to continue the dialogue with the government to understand where does this industry go and where do we need to collaborate to, to deliver what we need from a societal perspective as well as from a consumer perspective.

“We have I think a very good open and constructive dialogue with the government. We always are keen to have clarity and to have consistency and to ensure that we have competitiveness in the marketplace and I think that … view would be shared by most [industry] people.”

When asked if the axing of the green-car fund had spooked Ford’s head office in Detroit, especially given that Falcon and Territory sales have been fragile in recent years and the future of Ford’s Broadmeadows production line has been under scrutiny, Graziano said:

“Well I think clearly it was a disappointment that they took the Green Car Fund out but we had access and that money … is still coming for the Ecoboost [four-cylinder Falcon].”

When asked if the early withdrawal of the green car fund – and the introduction of new emissions regulations – would seal the Falcon’s fate beyond 2016, Graziano said:

“Well I mean it’s tough, it’s tough to say at this point. [The 2016 Euro 5 emissions deadline] gives us the clarity that we’re looking for and now we can understand what it means for us.

“We welcome that and we really appreciate the government providing that clarity for us and now we’ve got to understand what it will require to get to that next space.”

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