Manufacturing an ‘essential industry’: APV

A LEADING Australian-based global automotive components supplier, APV, has urged the federal and Victorian governments not to close down medium-sized manufacturing businesses as a result of the escalating coronavirus pandemic, citing a range of broad health and economic reasons including risking the viability of one of APV’s own local suppliers which also produces plastic parts for life-saving medical equipment.

Speaking exclusively to GoAuto, APV managing director Harry Hickling described a mandatory shutdown as unnecessary when the tightly controlled working environment at its Melbourne factory – which he described as a “forced lockdown” – was in effect acting as a safe haven and that keeping its production lines running was providing vital support for its workers, the company and broader economy.

He said this was particularly relevant given the Victorian government had arbitrarily chosen $3 million in salaries and wages as the cut-off for support for small-to-medium enterprises (SMEs) which means that “high value-added manufacturing companies in the medium sector are missing out on support”.

Currently with 55 staff on its payroll, APV produces restraints across various sectors including automotive, military and industrial for domestic and global clients, and runs an internationally accredited safety testing and certification centre for motor vehicles, child seats and restraint systems for specialist applications such as wheelchairs, ambulances and fire trucks.

Mr Hickling said the company would switch production of any products deemed “non-essential” to items that will help in the fight against COVID-19 wherever possible, but, among its own supply chain, APV also receives components from at least one Australian company that is already producing plastic parts for specialist medical equipment.

He said cutting off the supply to APV were it to be forcibly shut down by government could in turn place unwanted pressure on those other suppliers.

“Importantly, government must understand that Australian manufacturing is highly diversified and that the manufacturing base is not easily split between essential and non-essential services,” he said.

“As an OEM manufacturer we have a supply chain that is also integrated into providing goods and services into the medical, food and other essential services industries.

“With our production volumes, many suppliers into these industries are also reliant on APV’s business to keep them viable and in business.

“There is no easy way to differentiate between the two and I believe all Australian manufacturing must be viewed as an essential industry in these times.

“We can already see government calling on industry to consider the Australian production of medical supplies, respirators and face masks. To support this the industry base must be running. 

“This crisis is far from over, so who can foresee what other call to arms that government will make on the Australian manufacturing industry to support the country?

“Regardless of what product or service is involved, this will in effect be an essential service.”

Mr Hickling said forced closure of APV could jeopardise global contracts with customers including the US Department of Defense (DoD), which has already deemed the Australian manufacturer a provider of essential services under DoD and Department of Homeland Security (DHS) memoranda, and as part of the Essential Critical Infrastructure Workforce for the US Defense Industrial Base.

He also said he had written to the Victorian premier Daniel Andrews and minister for jobs, education and trade Martin Pakula, calling on them “to commit to keep Australian manufacturing open for business on the prerequisite that businesses implement the appropriate COVID-19 risk mitigation and health controls”.

“I just don’t see the rationale of that when, in effect, we are helping to implement government policy in the workplace,” he told GoAuto.

“APV’s workers are safer coming to work than going to the supermarket, as we can support the government health controls, both via the workplace measures in place but also by education and advice for when they are at home.

“In effect, our workers are at lower risk by coming to work than staying at home for their overall health, wellbeing and community risk. Here, the messages of social distancing are reinforced for both the workplace and home environment.

“Within the workplace we have implemented controls to isolate individual sections of the workforce and the business.

“Fundamentally, if employees stay at home and then come to work in an isolated community, the APV community, then they are better protected with greater support than being isolated at home.

“Other companies in the supply chain, or in manufacturing, have done the same thing. We’ve all implemented those practises now, so it’s unnecessary to close us.

“I can assure you that all of our employees at APV want to come to work.”

Mr Hickling said he had also recommended to the Victorian government that it establish an SME Manufacturing Industry COVID-19 Consultative Committee, created along similar lines to a committee established during the global financial crisis and for which he would offer his support and advice.

“That was made up of stakeholders within the automotive supply chain and a significant outcome of this was the programs for workers to get paid during training and trade certification courses conducted by Registered Training Organisations,” he said.

“This played a significant role in helping businesses work through and then rebuild during the GFC.”