Car industry facing problems

ABC television’s business analyst Alan Kohler says Australia’s car industry faces an insurmountable cost barrier that makes it virtually impossible to compete.
Mr Kohler’s comments came as Toyota Australia announced 100 job losses due to falling exports.
He said Australia’s car industry was ‘on the brink’, with Ford announcing its closure and negotiations underway between the Australian Government and Holden and Toyota for subsidies.
Mr Kohler said the Australian manufacturers’ share of the local car market had dropped from 20 per cent to 10 per cent in just five years and exports had been cut in half. That meant that 90 per cent of Australian cars were imported.
He said the costs of manufacturing cars in Australia were high, and that the prices of Australian cars were too high to be competitive. It did not make much difference whether Australia had a Free Trade Agreement with other countries or not.
The issue was partly because Australian manufacturers did not make enough cars and SUVs which were the most popular cars. The high exchange rate had exacerbated things too.

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