Top import-only brand backs taxpayer funding for local car industry

Australia's struggling car manufacturing industry has found an unlikely ally. Top-selling import-only brand, Mazda, says manufacturing is crucial to the prosperity of the national economy – and the car business as a whole – and should continue to receive taxpayer-funded assistance.

"In most countries manufacturing is supported by government to stimulate their economies, why should Australia be any different," the managing director of Mazda Australia, Doug Dickson, told motoring.com.au.

Dickson made the comments at this week's launch of the updated Mazda3, a small car imported from Japan which leads the locally-made Holden Commodore as Australia's favourite in 2011 – and threatens to end that model's 15-year winning streak.

The Mazda boss is Honorary Treasurer of Australia's peak automotive industry body, Federal Chamber of Automotive Industries (FCAI). However, Mazda does not make cars in Australia, has no plans to make cars here, and would benefit from weaker competition.

"If manufacturing decreased and it resulted in the demise of some of our competitors, that to me is only a very minor benefit," Dickson said.

"We will survive, grow and expand irrespective of who's in the market.

"The issue is, economically, from an Australian's point of view, I'd like to see us having the capacity to make sophisticated things here.

"It's very important that Australia retains the ability to build cars. We are a significant employer in the manufacturing industry [which] benefits the broader community."

Furthermore, he said, having a local manufacturing industry gives car companies – including importers – greater access to government and policy makers.

"It gives the industry a much bigger voice and presence among the people who make policy decisions," he said.

Dickson conceded the future of manufacturing is uncertain beyond this decade as blue collar employment shifts to the resources sector.

"It may be inevitable that we move from a manufacturing base to a resource base but I know the government is concerned about it," he said.

"There may well be some great advantages from [becoming reliant on the resources sector] but it's just unclear to me … That it's going to provide the same level of [job] protection.

"At the moment there is a fundamental restructuring taking place and that's partly what's causing the unemployment rate. The labour market is not coping all that well with this transition. It's not absorbing the movement out of manufacturing quick enough and that's why unemployment is actually on the rise."

When asked if he believed there would be a car manufacturing industry in Australia beyond 2020, Dickson said: "It depends entirely on what they [Holden, Ford and Toyota] make. If they make cars that Australians want to buy they've got a future.

"I hope we will [continue to build cars in Australia] because I'm sure that in the end governments understand the need to be able to build sophisticated things locally and the employment that generates across the economy."

Australia's three local carmakers – all of which receive various levels of taxpayer funding – are struggling for different reasons and their viability has been under increased scrutiny in recent years.

Ford's Australian factory currently has the lowest output in its history – and no export plans on the horizon. Holden is struggling to revive export deals to the US and has just had its Brazil export deal collapse.

Meanwhile Australia's biggest automotive exporter, Toyota, has been crippled by the strong Australian dollar (it claims it 'loses' about $3000 per car it builds). On top of this Toyota is currently trying to end strike action over a pay dispute, while competing with six other factories around the Toyota world that make the same vehicle.

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