Toyota calls on PM over car industry

Toyota executives were among a raft of car industry and union chiefs to appear at the hearing, in Melbourne on Tuesday.

The Abbott government has directed the commission to review public funding for the auto industry, with a preliminary report due in just over a fortnight.

Mr Abbott pledged in opposition to reduce aid to the industry by $500 million, and the Coalition is now awaiting the commissions report before it finalises its decision.

Industry Minister Ian Macfarlane declared the government wanted a sustainable and profitable automotive manufacturing sector.

The Coalition wanted the Productivity Commission to find the best way the Australian government (and the economy) could ensure car making was viable into the future, he said.

In the 2011-12 financial year, the federal government handed Australian car and auto parts makers $580 million direct funding and $41 million in tax concessions. The government also provided almost half a billion dollars in tariff assistance.

In the same period, taxpayers gave $492 million in combined assistance to the mining industry, $550 million to farming and $905 million to the banking and insurance sector.

Toyotas Mr Rausa told the commission that for every taxpayer dollar handed to the company, it spent at least $20 on manufacturing.

If Toyota did not build cars in Australia, Mr Rausa said, this money would be spent in another country.

He said Toyota was deciding whether to manufacture a future model of its popular Camry vehicle in Australia, at its Altona plant where 2500 people work, or at factories in Tsutsumi, Japan, or Kentucky in the United States.

We are competing against other Toyota plants around the world to secure this investment, he said, and a decision would be made next year on whether to make the next Camry model in Melbourne or elsewhere.

He said there was an incorrect notion that local manufacturers were building cars Australians do not want to buy. The reality was that Australian-built cars featured prominently among the top selling cars.

And he said government support for car manufacturing in Australia was modest compared to other countries.

Also appearing at the hearing was Australian Industry Group chief Innes Willox, who said the existing federal auto funding already pledged by the previous Labor government should remain.

Ford this year announced it would end manufacturing in Australia in 2016, and Holden and Toyota may pull out too if the Abbott government slashes public funding.

And the Australian Manufacturing Workers Union told the hearing it was vital the government continued to fund the auto industry at its present levels.

This issue is beyond politics, and we need a vision, not a planned closure of the industry, said Dave Smith, the unions vehicles division secretary.

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