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Productivity Commission’s final report on car industry

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The Productivity Commission has officially begun a study into Australia's auto manufacturing industry and revealed the terms of the investigation.

As the ABC reports, an interim report will be completed by December 20 and the final report will follow on March 31.

A joint statement by Federal Industry Minister Ian Macfarlane and Federal Treasurer Joe Hockey stated that the government will not make any decisions about further assistance to the industry until the final report is released in March.

According to the statement, the report will "examine the best way that the Australian Government and Australian economy can ensure the ongoing viability of the automotive industry … including a sustainable and profitable automotive manufacturing sector".

As the Herald Sun reports, the terms of reference include problem areas for the local sector. It will examine "international competitiveness, exports, workforce structure and practices, skills levels and long-term sustainability".

Both Macfarlane and Hockey signalled that they have no intention to allow the car manufacturers to bully the government.

Hockey confirmed that no funding decisions will be made until the Productivity Commission’s report is handed down and said, “... we don't negotiate, when it comes to taxpayer's money, with a gun to our heads, we won't do that.”

Macfarlane even conceded that the industry may not survive. He said that Holden may follow Ford in closing its local operations which would make it even more difficult for Toyota to continue.

“There's a possibility that the industry is not able to be saved in terms of the level of support it might require,” Macfarlane told The Australian.

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