Automotive

About the automotive industry

The Australian automotive manufacturing industry comprises firms involved in motor vehicle parts manufacturing, and motor vehicle body and trailer manufacturing (e.g. trucks and caravans).

In regards to domestic passenger motor vehicle manufacturing, the three passenger motor vehicle producers, Ford, Holden and Toyota, have each ceased manufacturing in Australia: Ford on 7 October 2016; Toyota on 3 October 2017 and Holden on 20 October 2017. All three motor vehicle producers will maintain a significant Australian presence through sales/distribution, engineering services and design/product development.

Automotive manufacturing statistics

 

2013-14

2014-15

2015-16

Employment

44,342

40,642

39,271

Industry Value Added ($m)

4,171

3,726

3,596

Sales and Service income ($m)

20,051

17,528

17,993

Source: Australian Bureau of Statistics (ABS). These industry statistics relate to ANZSIC Group 231 - Motor vehicle and motor vehicle part manufacturing. Merchandise exports and R&D expenditure is not available at the ANZSIC group level and cannot be estimated for the level of Motor Vehicle and Motor Vehicle Part Manufacturing. R&D expenditure is only available at a higher level for Transport Equipment Manufacturing.

Government programs

  • Advanced Manufacturing Fund
    On 8 May 2017, the Australian Government announced the $100 million Advanced Manufacturing Fund to drive innovation in Australia’s manufacturing sector to create jobs, grow businesses, improve productivity and be globally competitive. The Fund will: encourage further research; invest in emerging engineers and scientists; provide facilities to test new products; and develop business capability. Importantly, support to advanced manufacturing businesses will encourage investment in new processes and equipment to ensure that they are world-leaders in competitive global markets.

    More information is available on increased investment in advanced manufacturing.
  • Advanced Manufacturing Growth Fund (AMGF)
    The AMGF, an element of the Advanced Manufacturing Fund, will help car-related businesses move into other industries and fund research into manufacturing techniques and tertiary engineering courses, complementing other Australian Government automotive programmes.

On 17 October 2017, the Government announced Round 1 of the AMGF which provides almost $30 million in grants to 20 companies in South Australia and Victoria to establish and expand advanced manufacturing activities, leveraging a total investment of $119 million.

While a range of advanced manufacturing businesses received funding under the AMGF, this included four automotive related firms:

  • Air Radiators (Victoria) will receive $1,848,506 to develop the next generation of heavy duty radiators.
  • Carbon Revolution (Victoria) will receive $2.5 million for the development of a high-volume moulding process for carbon fibre wheels.
  • FMP Group (Victoria) will receive $1,497,786 for the development of advanced friction automation technology.
  • Nissan Casting (Victoria) will receive $2.5 million to enable the production of next generation electric vehicle parts for the global market.

Two other elements of the Advanced Manufacturing Fund that are directly related to the automotive industry are:

  • $13.5 million Tariff Reduction on imported vehicle and component prototypes
    The tariff reduction on imported vehicle and component prototypes for automotive service providers to conduct research and development was passed by Parliament and received Royal Assent on 16 August 2017. The tariff concession was backdated to 1 January 2017.
  • $5 million Automotive Engineering Excellence.
    The $5 million in grant funding is aimed at maintaining engineering excellence by investing in student research at universities, technology institutions and in industry to continue the flow of highly trained engineers to the automotive design and engineering sector.

    More information is available at increased investment in advanced manufacturing
  • Automotive Transformation Scheme (ATS)
    The ATS is a legislated entitlement scheme which encourages competitive investment and innovation in the automotive industry. The ATS will provide up to $2.5 billion in capped assistance and approximately $337 million in uncapped assistance from 1 January 2011 to 31 December 2020.

    More information is available on the Automotive Transformation Scheme (ATS).
  • Automotive Diversification Programme (ADP)
    A $20 million programme to assist Australian automotive supply chain companies to diversify out of the domestic automotive manufacturing sector and thereby retain manufacturing capability in Australia. The ADP is one element of the Growth Fund. Refer below for more information on the Growth Fund.

    More information is available on the Automotive Diversification Programme.
  • Automotive Industry Structural Adjustment Programme (AISAP)
    AISAP provides labour adjustment funding for training and assistance to displaced automotive workers.

    More information is available on help for workers who have recently lost their job.

Diversification Case Studies

The following case studies showcase some of the companies that have successfully diversified from the automotive industry.

  • Backwell IXL
    Backwell IXL has grown from manufacturing automotive components in metal stampings, finishing, roll forming and assembly for all three car manufacturers, to successfully diversifing the business to design and manufacture heating consumer goods for bathrooms (i.e. the IXL Tastic, a 3 in 1 bathroom heat, vent and light product, the Neo Tastic, a fan, light and heater combination, as well as a range of Cannon Gas space heaters). The third arm to the business is a ferrous foundry, supplying castings to the resource industry and as a Tier 2 supplier through its customers to the global market. Backwell has received funding under a range of programmes, including the Automotive Diversification Programme.
  • Samvardhana Motherson Reflectec (SMR)
    SMR Automotive Australia has manufactured and distributed rear-view mirrors and related products for the global automotive sector for more than 25 years. The company has successfully diversified the business by investing heavily in research and development, engineering and design skills, and lean, automated and highly efficient manufacturing production processes. It now competes in the medical devices and clean technologies sectors. The company recently established a new division, SMR Technologies, which is seeking to develop products in markets requiring precision, highly engineered, moulded and electronic component combinations. SMR has received funding under a range of programmes, including Automotive Diversification Programme.
  • Dolphin Products Pty Ltd
    Dolphin Products has been manufacturing high precision injection moulded plastic components since 1946. The company has diversified into existing and emerging industries with its range of plastic products and it is now a leader in explosive and blasting systems for the mining industry. Dolphin Products benefited from Automotive Diversification Programme (ADP) funding to move into a new mining product manufacturing role.

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