Concerns over the viability of the Australian automotive industry have escalated in the wake of Ford’s decision to pull out. There have been calls for a return to higher import tariffs, moves to artificially deflate the dollar, and even for appointment of a car ”tsar” to stop the industry from sinking.
Source: Sydney Morning Herald
Where to start with such a blatant display of anti-foreign bias and anti-welfare enhancing trade bias?
The decision about whether or not Australia needs an auto industry is made at the local dealerships.
Over the past few decades, Australian consumers have moved away from buying Holdens and Fords.
For consumers at the top end of the market, they’ve earned so much money that they’d prefer an Audi or a Range Rover.
For consumers at the bottom end of the market, they’re happy with imported used cars.
For consumers in the middle of the market, they prefer Hyundai and Toyota to Holden or Ford.
If Australian consumers actually wanted an auto industry, they’d ignore the relative cheapness of imported cars and only buy Australian.
They haven’t, so they obviously don’t value having a home grown auto industry.
Politicians who have the interests of their union supporters to look after are happy to use Other People’s Money to prop up a sunset industry.
When it comes to consuming new cars, Australian consumer’s preferences have been revealed.