Abbott sticks boots into car industry

UPDATED: 20/05/2013OPPOSITION leader Tony Abbott yesterday heaped praise on the Australian-made boots he was wearing – but completely ignored the Australian-made car he drives.

However, while he may have driven to Parliament House yesterday behind the wheel of his Ford Territory to present his response to Tuesday’s federal budget, Mr Abbott did nothing to quell any further fears that, if elected, he would cut $500 million out of support to the Australian car industry.

Mr Abbott’s response to the budget handed down by treasurer Wayne Swan talked up Australian manufacturing, with the promise that a coalition government would help businesses reduce their paperwork if elected.

“We will cut red tape costs by at least $1 billion a year – to give small business a much-needed break – and we’ll have parliamentary days dedicated to repealing laws, not passing them,” Mr Abbott said.

“By cutting tax and regulation, we will boost productivity. That will give Australian manufacturers the more level playing field they need to remain at the heart of a five-pillar economy along with services, education, agriculture and resources.”

However, when it came to singling out which Australian industries were doing well, all three local car-makers failed to rate a mention.

“With the right product, our manufacturing, too, is capable of competing with the best in the world, even with the high dollar – as demonstrated by Cochlear, Blackmores, Murray Goulburn and RM Williams, whose boots I’m wearing tonight,” he said.

A Singapore-based private equity firm tied to luxury goods giant Louis Vuitton bought an almost 50 per cent stake in clothing retailer RM Williams earlier this year. The rural clothing company has since said it would keep making its wares in Australia.

Mr Abbott’s commitment in his budget reply to abolishing the carbon tax introduced in July last year will also reduce costs to the Australian car manufacturing industry, which estimated prior to its implementation that the extra tax burden would be $45 to $50 million a year – or between $112 and $150 per locally built car from Toyota, Holden and Ford.

The federal opposition leader last month reaffirmed that a coalition government would commit only $1 billion of support to Australia’s three remaining car-makers and the components sector by the end of 2015. However, this is $500 million short of current funding levels.

Mr Abbott has also indicated a coalition government would end all car industry subsidies beyond that date.

Shadow minister for innovation, Sophie Mirabella, criticised Tuesday’s budget as lacking “any credibility and vision” for industry.

“Labor has a proven track record in failing to deliver on its promises when it comes to manufacturing, and no amount of window dressing, re-announcements or new bureaucratic acronyms will change this,” Mrs Mirabella said.

On the following Sunday, she also attacked comments attributed to federal Labor member Nick Champion that called for a special temporary “emergency tariff” of between 5 and 10 per cent on vehicle imports in an effort to help local manufacturers compete for sales.

“Tariff increases mean not only increased prices for imported cars, but increased prices for locally made cars,” Mrs Mirabella said.

“Labor can’t get its lines straight on tariffs. Australian business needs to know what extreme policies Labor are willing to introduce in their desperation to win votes.

“At worst Labor is just trying it on and will say anything before an election only to break their promises after the election. Since coming to government, Labor has broken $1.4 billion worth of promises to the car industry.

“If Labor was really concerned about the ability of Australian industry to compete on a level playing field, they would abolish the carbon tax.

“If elected, a coalition government will hold a Productivity Commission review into the car industry to develop a funding model to ensure the long-term viability of the car industry in Australia.

“The coalition has a clear position on the car industry. There will be no surprises or broken promises like we’ve had under this dysfunctional Labor government.”

Holden managing director Mike Devereux last year said the car-making industry was set to become an election issue, and called on Mr Abbott to commit to an Australian automotive industry before September’s federal election or risk losing it.

“I believe 2013 will be the year that Australia decides whether it wants an auto industry or not,” Mr Devereux said.

The Gillard government has committed to spending $5.4 billion on Australia’s car-making sector over the next 17 years, despite a string of job losses as buyers switch off locally made large cars in favour of smaller, more economical models.

Mr Abbott said last month that the lack of an export program for the Broadmeadows-made Territory SUV broke his heart.

“As someone who has driven a Territory for most of the last decade, I know what a great product that is,” he said.

“I know it is emblematic of the great products that people can make right across the motoring sector generally here in Australia, and the thing that breaks my heart is that this great Australian car is virtually only available here in this country,” Mr Abbott said.

“Why isn’t the Territory sold in the US? Why isn’t it sold in the Middle East? Why isn’t it sold in Europe? Why isn’t it part of the offering wherever its manufacturer is selling, given the quality of that particular car. And the same goes for the other cars that are made in this country.”

Ford has since said developing a left-hand drive program for the Territory would cost too much to make it viable.