Global automotive opportunities for Australian companies

TRANSCRIPT Phil Bourke: The manufacture of passenger
motor vehicles in Australia will finish by the end of 2017. Austrade has been working
with many of those companies over recent years to help them access new customers in automotive,
new markets in automotive and even diversify out of automotive into other sectors. Nicola Watkinson: The automotive sector in
India is really going through a lot of rapid growth. We’re up to about three million
passenger vehicles per year and India is predicted to become the fourth largest automotive market
in the next 12 months. One of the interesting things is that there
is a lot of room for growth still in India. At the moment only 18 out of every 1,000 Indians
actually possesses a motor vehicle, and in addition to that what we’re seeing is that
the Modi government through it’s Make In India campaign is driving the automotive sector
to actually move into the export market as well. So that’s going to create even further
impetus for growth. Greg Wallis: In Indonesia there’s been growth
of the automotive industry of about 20% a year since 2006. In Thailand about two million
vehicles are produced a year and in Malaysia there are about 800 components manufacturers
in that country, so that by the year 2020 we believe there’ll be something like 100
million consumers in ASEAN. Phil Bourke: A number of global vehicles,
all their research and development and design have been done in Australia. Those skills
can now be taken to the world and we find, particularly from the Indian market and the
Chinese market, they are demanding those sorts of skills from the Australian supply chain. Nicola Watkinson: The Indian OEMs are now
really focused on improving their competitiveness in a way that they weren’t even five years
ago, and that includes both new product competitiveness to make their offering more attractive to
the consumer, as well as process improvements to make themselves more efficient and cost
effective. Greg Wallis: There is still some demand for
specific components which we can export to ASEAN. There’s a growing use of off road
and four wheel drive vehicles by the public and that’s creating a demand for the sorts
of products that Australia has manufactured for many, many years – lightweight materials
for vehicles, clean car technologies and specific design capabilities for individual components. Phil Bourke: In less developed supply chains,
particularly now in Asia, that design capability is still with the OEM, still with the vehicle
manufacturer. However, within the next two or three model cycles that design capability
will require — well the OEMs will require to be embedded within the component supply
chain. So the Australian companies now have that unique window of opportunity to take
their design skills into equivalent component manufacturers within the Asian region. Greg Wallis: They’re making cars to be shipped
around the region and around the world. So the market is much, much bigger and to get
into that market, generally speaking, you need to be there. Mark Albert: One of the key things when you
realise you’re part of the global supply chain is you need to keep making improvements
of your product. What is it that the customer’s looking for, what is that small improvement
that places you ahead of the pack. It’s not always on price. Yes, your quality has
always got to up there, and then they’re looking for those other things that are on
the fringes that make you a different supplier. Australia is less than 1% of global automotive
manufacturing. If we can survive on 1% in Australia, all we need is less than one or
1% again and we’ve doubled our business. That’s a huge growth, so we don’t need
much to win business in Australia to be successful. Greg Wallis: We have staff that work for Austrade
across the region that understand this market very well. They speak the language, they know
the manufacturers, they know the OEMs and Tier 1, Tier 2, Tier 3 suppliers. So those
are the critical things that a manufacturer needs to know in the context they need to
have in order to find their opportunity within that market. Mark Albert: MTMs, two mainstreams of non-automotive
business and automotive. We intend to stay in both markets. We’re currently quoting
on volumes in the global vehicle platforms of five million plus units. That now makes
us think differently about how we’re going to manufacture those products and in the non-automotive
space we’ve got more than a handful of products that we’re looking at and talking to new
manufacturers about opportunities. So we see a very bright future and I hope other industries
and suppliers see a very bright future also. [END TRANSCRIPT]