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Transcript of interview with Emma Alberici: ABC Lateline: 31 October 2016: meeting with major automotive companies in US and Japan



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The Hon. Greg Hunt MP Minister for Industry, Innovation and Science

TRANSCRIPT

31 October 2016

ABC LATELINE

INTERVIEW WITH EMMA ALBERICI

E&OE…

Topics: Meeting with major automotive companies in US and Japan

EMMA ALBERICI: Greg Hunt, thanks for joining us. What is the point of your meetings with Toyota, General Motors and Ford this week?

GREG HUNT: It is to make the case for Australian jobs, to fight for Australian jobs in the automotive in the sector.

There is a long-term future. I am now convinced of this for our engineering, our design, our research and development workers.

We have some of the best in the world in this space and Ford and General Motors have already confirmed this.

Tomorrow I am due to meet with Toyota, but my view, coming away from North America, is that the big car companies there are committed to a long-term engagement in Australia as part of a global supply chain, as part of a global design team for Australian workers and also they want our components.

So we have the people and the parts to be part of a global supply chain and that message was very clear from both Ford and GM.

EMMA ALBERICI: The Productivity Commission in its report said that the closure of the car industry in Australia would result in the loss of something in the order of 40,000 jobs and the Bracks Report in 2008 said that the multiplier effect meant something like 200,000 job losses.

How many of those will you be able to save and keep here in Australia?

GREG HUNT: Well, we already seeing a significantly better result. For example, we have seen that Ford has been able to transition many workers from the manufacturing side to the testing side, to the R and D side. So, the skills have been transferred and are transferrable.

Many of the component manufacturers, firms such as SMR in SA, have been tremendously successful on the global stage.

The former Pilkington Glass is transitioning from making automotive glass to architectural glass.

Firms such as Carbon Revolution in Geelong. I saw their world-class wheels, their carbon wheels, which are leading the world in both Ford and GM and, in particular, the proof of the pudding was that Ford is producing Australian wheels on their global top-of-the-range vehicle, the sort of super sports car GT.

Where were the wheels from? They were from Australia. Where in particular? They were from Geelong. So this is an example that we can part of the global component making and we have the design skills to be one of three global design centres for Ford.

EMMA ALBERICI: You didn't answer my question with respect. How many of the jobs that will be lost in the sector can you keep?

GREG HUNT: Well, I think that we will keep a significant number in the component field and also in the design and the engineering.

Those figures I think have already been questioned by many. I know that the advice from my department is we are likely to have a far better outcome, but let's be clear, the loss of the assembly has real impacts on families and on workers.

My job now is to fight for the jobs and the opportunities, in particular, for Australian component manufacturers.

We have struck a partnership with Ford and with the component manufacturers and the government to work together to provide opportunities for Australian firms and to make sure that we have on the ground these Australian design and engineering centres.

I know that Ford is looking at 1600, GM is looking at 300 workers. I'll know more from Toyota after I have met with them tomorrow and then you have a component sector, which has to be world- class competitive, but already we are seeing Australian firms develop, expand and move into that space.

EMMA ALBERICI: So, in the order of about 1-5% of the jobs that were lost you might be able to retain. What is the government's role here? Are you offering some kind of…

GREG HUNT: No, with respect, Emma, that is completely wrong. With respect, Emma, that is completely wrong.

The presumption of your numbers is inaccurate, unproven and is rejected fully.

EMMA ALBERICI: That is actually from the Productivity Commission and also from the Bracks Report.

GREG HUNT: Going forward, what were they looking for? They were looking for Australian skills. What they said was that our design skills are absolutely the best in the world, as evidenced by the fact that the seventh only ever GM head of global design is an Australian, Mike Simcoe.

What they really want from us is to see that Australian graduates were coming through in terms of industrial design, automotive engineering, mechanical engineering. That we have this continuous flow.

Therefore, the changes that we were looking at in relation to the R and D tax incentive, something that we are looking at, as part of a broader review, which would encourage the support for PhDs and graduates who are working in the science and technology and engineering and maths space.

This was of high interest because it helps, not so much to support the individual firms, but to have that strong pipeline of Australian graduates.

There is a real opportunity for young Australians to work in the automotive design, in the automotive engineering, in the R and D space and we need more, not less, graduates in this space.

EMMA ALBERICI: Minister, what do you say to the 600,000 Australians who cast their first preference votes for Pauline Hanson's One Nation at the last election, a party which stands firmly against globalisation

because it has taken Australian jobs and, in their words, "ruined the manufacturing sector"?

GREG HUNT: I have deep respects for the views of all Australians, but it is absolutely clear the only way that you keep blue-collared jobs, manufacturing jobs, in Australia is by being world-class competitive.

If you turn your back on that, those jobs will be lost.

There is no question about that and when you see Australian firms such as ANCA, which is arguably one of the world's two most advanced machine tool makers, you can see that we can be highly competitive, create highly skilled jobs and value jobs.

And if we turn away from those opportunities to be part of the global supply chain then we will doom individual workers and individual firms.

So it is the firms that are competing that have the real prospects.

EMMA ALBERICI: Mr Hunt, your strategy stands to be significantly undermined by a Trump presidency, doesn't it, given he is a candidate who stands against globalisation himself and for protectionism within the

United States?

They are not going to look too kindly, a Republican Administration, under Trump, towards an Australian company if they can give the work to an American one?

GREG HUNT: I won be drawn on the US election. That will be resolved in very short order by the people of the United States.

But having just been with Ford and GM, I know from the executive who make the decisions that they are looking to Australia for parts and components. I think there are 19 Australian firms who are part of the Ford global supply chain at the moment and the people who make the decisions are looking for Australians.

Of course, we will continue to trade with the United States, of course there are significant opportunities and my hope and my expectation is that in time the United States will ratify the TPP, the Trans Pacific Partnership and that will add more opportunities for Australian firms.

EMMA ALBERICI: Greg Hunt, thank you for your time.

GREG HUNT: Thanks very much, Emma.