The Australian Industry Group (Ai Group) announced that it supports the federal government’s plan to assist ailing car manufacturers to produce ‘greener’ cars, saying it is a “strong package that will… provide much-needed support.”
“It creates an opportunity for the industry to reinvent itself in a spirit of mutual obligation,” said Ai Group chief executive, Heather Ridout.
According to Ridout however, the industry needs to invest itself in order for the government grant to work.
Ridout says car manufacturers need to reciprocate by co-investing to put in place ‘green plans’, which will go towards ensuring that the $6.2 billion grant offered by the government re-invests $16 billion into the industry.
“The package will enable the industry, as it transitions to lower levels of tariff assistance, to continue its important role in the manufacturing sector and in the broader economy including through its contributions to Australia’s business innovation system,” she said.
“The Government has not only accepted the recommendations of the Bracks Review, but has acted sensibly in bringing forward its implementation and boosting funding for the Green Car Fund and the industry restructuring package.”
This isn’t as bad as it will get though, according to Ridout, who says the automotive industry can look forward to “tougher times” in the coming year.
“Implementation from the start of next year will help the industry to restructure operations for tougher times. With car sales down both in Australia and globally, reflecting the global credit crunch, weaker consumer confidence and the slowing in economic growth, the car plan will boost investment in the industry and help reposition Australia’s automotive sector into a new growth segment of the car market.”
Ridout also assures the industry that the issue of obtaining secure sources of finance following the withdrawal of a number of Australian financiers has been made a “matter of urgency”, requiring input from both the government and the industry.