Australian car manufacturing could and should return, says local CEO

7NEWS

5 days ago

As the head of a major automotive engineering company, Premcar CEO Bernie Quinn understandably is a cheerleader for local auto industry, but he thinks that car manufacturing should not only return to Australia, but could.
The Premcar boss argues that demand for locally tuned products from both his company and Walkinshaw Automotive shows there's demand for vehicles developed in Australia, for Australians.
'We're doing it through secondary manufacturing at the moment, but this could be expanded to build cars in Australia for Australians,' Mr Quinn told CarExpert in a wide-ranging Expert Insights interview.
You can read our full Expert Insights interview with Premcar CEO Bernie Quinn here.
'We'd have to invest a lot of money. We'd have to build all that capital equipment again and all that infrastructure again.
'It wouldn't be easy. But is it possible? A hundred per cent, yes. Would it be successful? 110 per cent. With the right attitude and the right amount of commitment it could be very, very successful.
'And keep in mind that many of the countries that dominate new-car manufacturing and assembly today didn't know how to make cars or their components 40 years ago. But with the right attitude, commitment and investment they've achieved remarkable results.'
While Chrysler, Nissan and Mitsubishi, among others, had long ago ceased Australian manufacturing, Holden, Ford and Toyota continued well into the 2010s.
Ford announced in May 2013 it would end Australian production in October 2016, and this set off announcements from Holden, which announced in December 2013 it would end all local production in October 2017, and Toyota, which announced in February 2014 it would also end production in October 2017.
There was a common theme in these announcements. Holden and Toyota both blamed an unfavourable Australian dollar, poor economies of scale, and high manufacturing costs, with Ford noting its costs locally were double that of its European operations and nearly four times those in Asia.
Companies such as Ford have maintained a strong local engineering presence, while others like Premcar modify existing vehicles and Walkinshaw remanufactures vehicles in right-hand drive with the backing of their original manufacturers.
However, no passenger car, light commercial vehicle or SUV is produced in its entirety in the Australian market.
Mr Quinn blamed the shuttering of local manufacturing on exchange rates.
'You have to remember that the decisions made about closing the local new-car manufacturing industry in Australia were made at a time when our currency was, let's say, artificially and temporarily high,' said Mr Quinn.
'Those decisions had their gestation in 2009. That was the time when key decisions about the possible next Commodore, next Falcon and next Territory were being cemented.
'The Australian currency didn't support the industry at the time because it was about A$1.05 to A$1.10 to the US dollar due to the global financial crisis, which happened mostly in other countries, and not to the same extent in Australia.
'And that was really the beginning of the end. Now, when these big car companies closed their doors on local manufacturing, the currency was back around 70 cents US, and at the moment it's around 65 US cents.
'We would be very competitive if we had maintained all the capital equipment and knowledge and systems and processes. We had been able to capture that and leverage it in 2009 through to 2015.
'We'd have a thriving industry now, so it was really an aberration which led to its closing. That's the really frustrating and disappointing thing about it.'
Premcar can trace its roots back to the 1996 launch of the Tickford Vehicle Engineering-enhanced Ford EL Falcon GT, followed by the 1998 TS50, TE50 and TL50, and the 2001 Mustang converted locally to right-hand drive by Tickford.
FPV (Ford Performance Vehicles) was then formed in a joint venture between Ford and Prodrive, which bought out Tickford, and the first fruit was the 2003 BA Falcon-based FPV GT. Prodrive also collaborated with Mazda Australia to create the MX-5 SP, and with Toyota Australia to create the TRD Aurion and HiLux.
After it developed the supercharged 5.0-litre 'Miami' V8 for FPV's Falcon-based range, Prodrive became Premcar in 2012 and produced a succession of powerful Falcon-based sedans in the dying days of the homegrown large car.
In 2015, Premcar also began its extensive defence industry work, and even co-developed its first helicopter for a major corporation, before teaming up with Nissan to become one of Australia's two largest automotive engineering companies alongside Walkinshaw Automotive.
While Premcar currently doesn't remanufacture vehicles in right-hand drive like Walkinshaw does with pickups including the Chevrolet Silverado, Ram 1500/2500 and Toyota Tundra, it has the experience to do so and Mr Quinn has teased 'it's quite likely at some stage you'll see something about this from Premcar'.
In the meantime, Premcar works over the Thai-built Nissan Navara ute to create the Navara Warrior and transforms the Japanese-built Nissan Patrol into the Patrol Warrior.
It has also formed a joint venture in South Africa to produce Navara Warriors at Nissan's factory there.