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Ode to Australian Manufacturing - the End of an Era

With the announcement today of the closure of the Toyota manufacturing in early October, 2017 will be surely remembered in the history of Australian manufacturing as the year in which the vast bulk of auto manufacturing was laid to rest! Yes, Ford Australia has announced it will retain its design functions, GMH will move into the business of low volume high performance cars principally for the export market and Toyota Australia will close down its advanced manufacturing plant at the end of 2017. The fact remains that in 2017, Australia is getting out of the only area of major advanced manufacturing left in the country.

This realisation was brought home to me whilst catching up on some television viewing over the Christmas-New Year break. National Geographic was screening a documentary in its 'Mega factory' series which celebrated in late 2012 the opening of Toyota Australia's new state of the art engine plant, making it the first Australian car manufacturer to produce both petrol and hybrid engines. With substantial co-investment from the parent company and the Australian Labor Government, the plant was designed to produce approximately 108,000 four cylinder 2.5 litre engines per year for its locally built Camry and Camry Hybrid and sedans with the new, more fuel efficient engines to be exported to Thailand and Malaysia.

A tour around the rest of this quite extensive manufacturing plant quickly revealed the extent of advanced manufacturing processes, particularly in robotics, and the high skilled nature of the work being undertaken by the plant's some 4,000 employees. This realisation brought to mind the fact that the Productivity Commission has warned that up to 40,000 jobs from manufacturers and component suppliers are at risk as a result of the closure of motor vehicle manufacturing plants in Australia.

As we move into 2017, the Government's foundling response to its industry destruction policies, the Advanced Manufacturing Growth Centre (AMGC), has claimed that "there are several globally successful Australian advanced manufacturers. Typically, they employ a large number of scientists and collaborate heavily with universities and the CSIRO. Perhaps the best-known example is Cochlear, which designs, produces and supplies implants for the hearing-impaired in more than 100 countries. Other companies such as Cablex, Marand Precision Engineering and Sutton Tools may not be household names, yet each of these ‘quiet champions’ has established indelible places in global supply chains by contributing high-value tools and parts that other manufacturers convert into finished goods."

Apart from omitting to mention Australia's other advanced manufacturing heroes such as ANCA and Resmed in this overview, the Growth Centre's response by way of realisable outcomes to date over the past two years has been truly underwhelming. In fairness, the Growth Centre concedes that " much more work is needed to ensure that a new generation of Australian companies follow their success. Major items on the nation’s to-do list include skilling Australia’s workforce, fostering stronger research collaboration and offering greater capital funding for start-ups."

Not surprisingly, the Growth Centre's spin doctors have claimed that "With the right blend of committed industry partnerships and government support, the future of advanced manufacturing in Australia is bright." We can only wonder how many Australians (for example, politicians, industry and business leaders, and the families of the soon to be unemployed auto manufacturing workforce and the like) will come to the view that the Coalition Government decision to close down a substantial chunk of the nation's advanced manufacturing capability was not a very bright idea at all, particularly as the global automotive industry is undergoing a major transformation into hybrid and electric vehicle manufacturing.

In current parlance, the political decision of deliberately causing the death of the Australian advanced manufacturing automotive industry may well be seen as a move that has not served to 'Make Australia Great' at all!

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