Home > Shorten blames Government for death of car industry

Shorten blames Government for death of car industry

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Opposition leader Bill Shorten says the government can’t be blamed for all the car industry’s difficulties but it can be blamed for its eventual death.

As the Business Spectator reports, Shorten said that the government’s rejection of Holden’s business case didn’t just cause Holden to pull up stumps on manufacturing, it also led to Toyota’s decision yesterday.

Toyota announced it will stop building cars in Australia by the end of 2017.

As a result, about 2500 of the 4000 workers employed by Toyota locally will lose their jobs. And thousands of component supplier jobs are also likely to disappear.

Shorten told ABC Radio that, following Holden’s decision, component suppliers “couldn't supply the volumes which made Toyota sustainable."

"The car industry in Australia has died on the government's watch, and I do blame them,” he added.

"I don't blame for the high dollar. I don't blame them for our fragmented market, but I do blame them for destroying the critical mass for car components."

Labor industry spokesman Kim Carr went so far as comparing the affect the decision will have on Victoria to the Great Depression. He claimed the economy will take 20 years to recover.

"There's likely to be, for many blue collar Australians, an economic crisis the like of which we haven't seen since the Great Depression," Carr told ABC Radio.

"There are going to be families that won't be able to get work. There will be whole communities that will be savaged by this decision."

However, as the SMH points out, yesterday’s decision comes despite the fact that Toyota, the world’s largest car maker, received government grants of up to $492 million over the past four years.

According to the company’s most recent accounts, it received a total of $154 million under the federal government's Automotive Transformation Scheme (ATS).

And in that same period Toyota received tens of millions more in other sundry income from undisclosed sources. For example, according to company accounts, it received $127 million of sundry income in 2011 and an additional $126 million in 2010.

A Toyota spokeswoman could not be reached, but in the past the company has said it would be an ''overstatement'' to attribute the entire sundry amount to government grants.

Meanwhile, the country’s largest motoring and logistics group Automotive Holdings Group said in a statement that Toyota's decision is "not expected to have any material impact" on it.

Managing director Bronte Howson said in the release that he believed the Toyota range would continue to be an important part of the Australian market.

"Toyota, Ford and General Motors remain leading global manufacturers... and we are confident they will continue to be an important part of AHG's broad product range," Howson said.

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