Carbon tax will add cost to locally-made cars: Holden

The Prime Minister has exempted petrol from the new tax, but what about vehicle production?

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Australian car manufacturing would be dealt another blow – and vehicle importers handed another advantage – if the proposed carbon tax is applied to the automotive industry.

That’s the warning from General Motors Holden boss and president of the Federal Chamber of Automotive Industries, Mike Devereux.

Devereux told motoring.com.au the estimated cost of a carbon tax to Australia’s three local car makers – Toyota, Holden and Ford – would be $40 million to $50 million each year.

Based on sales of locally made vehicles last year, that would equate to about $350 to the manufacturing cost of each vehicle – and make exports less competitive.

“There is … no question that a carbon tax in this country raises the cost for the auto business, for all the local manufacturers,” he said.

“A $20 to $30 per tonne [carbon tax] raises our costs between $40 million and $50 million; that is a fact of life.

“So it’ll raise the price of doing things, and I’m just saying that as you do that, you have to be aware of what that does from a competitive standpoint to industries as they compete with [other countries in] Southeast Asia.”

Devereux said he did not envy the government trying to implement such a complex tax while considering which industries might be exempt.

“There’s no question that we all need to consume less things and produce less emissions,” he said. “[But] I think Australia ought to be on the cutting edge of looking at its carbon footprint and having high-tech manufacturing.

“This is a tough equation to figure out, and I don’t envy the people in Canberra in terms of the job that they have to do. All I can do is make sure that our position as an industry is well known so that there isn’t any equivocation about what is required to secure new investments in this country. That’s the game.”

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