Essay On Car Manufacturing Industry

The car manufacturing industry is an important pillar of the world economy affecting daily lives of people globally in many ways i.e. by creating job opportunity, introducing advanced technology and improving country’s economy. Likewise the car manufacturing industry in Australia plays very important role in Australia’s economy as well as is an important source of employment, employing thousands of employees. Automotive company like General motors Holden has helped Australia globally recognized as a major car manufacturer and created huge employment opportunity. But in the last few years, Holden suffered losses due to strong Australian dollar which directed declining sales of large cars in Australia. Also government fund being reduced this has led the company to look to international markets to increase profitability. Holden announced on 11 December 2013 that production in Australia would cease by the end of 2017 (Put Reference).

The car manufacturing industry in Australia provides a useful example of the way in which employment relations are shaped by a combination of global market pressures and local responses by governments, employers and unions.(Evolving Employment relations, Waring ,Bray page number 119 para. 1) The automotive sector accounts for approximately 6% of the total “value added” for manufacturing which is one of the largest source of employment and among Australia’s most significant export industries which comprises several hundred component suppliers and four foreign-owned vehicle assemblers: Ford, GM Holden, Toyota and Mitsubishi (Put reference).

Australia’s automotive industry is at a cross roads because of the declining vehicle volumes which have reduced benefits, forcing production levels below a critical fi...

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...d which automatically declined Australia’s car manufacturing industries business. On the other hand, the unions demanded high wages and conditions for their workers. This affected the economic status of the companies as they have to spend more on wages and facilities of workers. Apart from this, the bosses of international headquarters of the car companies treated Australian Government as a cash machine and made the value of Australian currency strong which discouraged sales of car in Australia.

Due to all those reasons, it became impossible to export cars because Asia-Pacific countries who are at the surroundings of Australia are manufacturing their own vehicles for one-quarter of the labour cost. (Joshua Dowling , The Big Read, 2014, p.4) www.couriermail.com.au/news/why-australias-car-manufacturers-toyota-holden-and-ford-all-conked-out/story-fnk1378p-1226827493012