Productivity Commission's preliminary report points to high cost, small scale of Australian automotive manufacturing

Preliminary findings provide a bleak analysis of the automotive manufacturing industry in Australia.

Australia's Productivity Commission has reported in preliminary findings that automotive manufacturing in the country has doubtful long-term viability as a result of a high cost base and small volumes. In its report, the Commission highlights the various factors weighing against local production, which include low economies of scale, high production costs, high labour costs, high costs of components, a highly competitive and fragmented domestic market, limited export potential, the high value of the Australian dollar, a high level of import competition with few barriers to those imports, high logistics and automotive component costs and utilities charges, and changing consumer preferences.