Australian car production out of step with global trends, says researcher

Ford Australia’s closures are “tragic but inevitable”, according to a Griffith Business School researcher. Anna Mortimore says the products being manufactured in Australia have not kept up with the global shift towards fuel efficiency and low-carbon emission standards.

“Penalties are being imposed on high-polluting vehicles globally - for example, Ireland imposes vehicle purchase taxes of up to $25,000 for high-emitting cars,” Mortimore said. “This is in addition to GST. Many countries don’t want them on the road anymore.

“In the European Union, the large passenger vehicles being built in Australia have become a luxury item.”

Ford Australia yesterday announced it will close its Broadmeadows car factory and Geelong engine plant by October 2016, having lost $600 million over five years in Australia.

“It’s very unfortunate but it is not surprising that sales have dropped,” Mortimore said. “They’re building cars that people don’t want anymore.”

Manufacturers like Ford and Holden could have focused on constructing electric or hybrid versions of their large vehicles, but Mortimore believes a short-term focus has ultimately led to Ford’s demise.

“The government has propped up jobs by throwing money at the situation, but on a global scale there is now a marriage of employment objectives and environmental objectives to be considered.”

Mortimore is completing a PhD on the use of economic instruments in managing environmental externalities of road transport. This involves how greenhouse gas reduction strategies have impacted road transport and motor manufacturing industries worldwide.