On Monday 9th February 1004, FCAI President, Geoff Polites said the agreement by the United States to immediately eliminate all tariffs on all vehicles and automotive components was a significant win for the Australian industry.

"Several Australian manufacturers are already exporting passenger cars and components to the US. We hope that this agreement will further underpin the success these companies have had in establishing a foothold in the world's largest automotive market", said Mr Polites.

According to Mr Polites "the agreement also opens up the possibility that Australian manufacturers will be able to take advantage of new opportunities for exports of utility vehicles to the United States. Until now, the US 25 per cent tariff has been a prohibitive barrier to exports of this type of vehicle from Australia to the United States".

Mr Polites said that the outcome is likely to result in some additional competitive challenges for the Australian industry. "The Australian vehicle market is intensely competitive with a wide selection of brands and model types competing at very strong levels of affordability. We can be confident the industry will positively respond to ensure that Australian new vehicle buyers will get even better deals".

"Australian car producers have been working in an environment of declining assistance for many years. As a result, they have a proven track record of innovation in design and flexible, cost effective manufacture, so Australia will remain a very attractive location for future international automotive investment", he said.

Mr Polites said "the agreement provides for a gradual phase in of lower tariffs on passenger cars imported from the United States, giving the local industry some time to adjust to the new arrangements in this segment of the market".

"The industry has been closely consulted during the development of this agreement. We have had extensive opportunity to ensure our views have been put to Government since early last year. We expect to continue to work closely with the Government and the Australian Parliament to successfully finalise the process for implementation of this agreement"

Can the Crewman make it in America?

It seems the industry expects utilities to be an early winner in any trade expansion between Australia and USA. But any export drive will require left-hand drive models. To complicate any plans, Australia's manufacturers must consider that sedan based utilities, known as pick-ups in North America, have failed in the past. Ford's Ranchero, Chevrolet's El Camino and GMC's Caballero left the market many years ago. The American markets loves big pick-up trucks. The big Ford F100 is America's best selling vehicle, consistently outselling every other car and truck model!

However, Australia's smaller production numbers, may provide an opportunity for our industry to open a niche market in USA. Such a move would strengthen the utes position in Australia by increasing the production numbers.

Once the position becomes clear, we'll report it.

Stephen Walker
Editor

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