Christopher Pyne’s belated ‘dismay’ at closure of the car industry

Former coalition minister for defence industry Christopher Pyne has revealed his dismay at the closure of the car industry which came after a challenge from then Treasurer Joe Hockey for GM Holden to leave the country.

Pyne did not express misgivings publicly at the time, but according to an interview in the website of the Australian Strategic Policy Institute his fear was that the closure would have a serious impact on the nation’s skills base.

“I thought to myself, ‘This is bad’,” said Pyne, now a defence industry consultant and head of Pyne & Partners.

“It was said constantly that Australia needed people qualified in science, technology, engineering and maths, but if there were no jobs, they would not study those subjects.”

The loss of the car industry caused overseas manufacturers to depart the country, numerous small companies reliant on vehicle manufacturing to collapse, while others have made the transition to other sectors including defence, medical technologies and green energy.

Adelaide, once the site of major companies Chrysler, Mitsubishi and GMH, was particularly hard hit as was Australia’s export profile – Australia now has a greater than $50 billion balance of trade deficit in transport equipment, importing 1.1 million cars annually, as well as trucks and buses.

The sector’s production peaked in 1970 at 475,000 vehicles.

Skills development was also hit as car manufacturing was one of the few Australian industry supply chains that was integrated into global supply networks – something Pyne now acknowledges.

He said: “They don’t have engineers, mathematicians, physicists, chemists, et cetera, working on the stock market floor or in Martin Place, but they do in manufacturing.”

Pyne said he was able to partly redress his concerns when appointed as Australia’s first defence industry minister by Prime Minister Malcolm Turnbull in July, 2016.

“We’ve got $200 billion of the biggest military capability build-up in our nation’s history. A large part of that can be used to remake our strategic industrial base.”

Pyne is seen explaining his views in a video interview as part of ASPI’s ‘Lessons in leadership’ series – it is a pity he didn’t speak up at the time, as the damage done to the economic base of the country is considerable.

Slipping to 93rd on the Harvard Kennedy School’s Economic Complexity Index (ECI) is just part of the fallout of forgoing your car industry.

Further reading:
Australia alone in G20 not making cars
@AuManufacturing readers comment on lack of car industry

Picture: Pyne & Partners/Christopher Pyne