On November 25, 2014 the Senate referred an inquiry into the future of Australia’s automotive industry to the Senate Economics References Committee for inquiry and report by the first sitting day in November 2015.

The review will be wide-ranging and the terms of reference will impact all aspects of the automotive value chain, including motor vehicle distributors and importers, Dealers, component makers, business models, sustainability of employment for workers in the automotive industry, aftermarket industry and new technologies influencing the industry.

Given the scope of the review, it is likely the Committee will examine any recommendations arising from the Harper Competition Policy Review, the Review of the Motor Vehicle Standards Act 1989, Productivity Commission Inquiry into Workplace Relations, and consequences of the new Franchising Code of Conduct which came into effect on 1 January 2015.

The Senate inquiry will make particular reference to;

(a)    Maintaining the capacity for Australia to engage in advanced manufacturing, by ensuring skills and industrial capabilities that have been sustained by the automotive industry are not lost:

(b)    Reducing Australia’s dependency on commodity exports by diversifying the country’s economic base, noting the importance of advanced manufacturing, including the automotive industry, in this diversification;

(c)    The role of all sectors of the automotive industry, including but not limited to, motor vehicle production, component making, after-market manufacturing, engineering, servicing, retail motor trades, other forms of sales support, and the training of apprentices, in supporting an advanced broad-based economy;

(d)    The special difficulties faced by component makers in the transition to global supply chains and to other forms of manufacturing, especially as a result of the closure announcements made by motor vehicle producers,

(e)    New technologies influencing the automotive industry, both in Australia and internationally, especially new and developing forms of propulsion, such as hydrogen, electric engines and hybrid engines;

(f)    New business models for the industry, including employee share models and attracting international venture capital and private investment;

(g)    The possible effects of early closure of motor vehicle producers, including risks and consequences for industry skills, capabilities and the broader economy, including social consequences, and what policy actions could mitigate or exacerbate these risks and consequences;

(h)    The need to synthesise and consolidate the findings, recommendations and knowledge of other reviews and inquiries pertinent to the automotive industry, in order to identify key policy inconsistencies, regulatory burdens and factors for growth and investment;

(i)        The importance of long-term stable employment for workers in the automotive industry, and the need for greater access to transitional training and career opportunities; and

(j)    And any other related matters.

AADA understands that the inquiry will be conducted in stages and has written to the Committee to advise that it is available to provide information or clarification in respect of issues affecting franchised new car dealers in Australia.