BHP chairman Jac Nasser worked at Ford Motor Company for 33 years, his final post there as head of global operations between 1999 and 2001.
He thinks Australian car manufacturing is doomed, as it can’t compete with foreign competitors with the dollar at a 30-year high, and the Yen and Euro week.
Here’s what he said:
“The signs aren’t good,” he said yesterday. “You’ve got an exchange rate at a 30-year high, you’ve got higher costs in Australia, you’ve got excess capacity in the motor industry worldwide, you’ve got a very weak currency in Japan and you’ve got a weak euro,” reported The Australian.
“When you put that mix together, it’s very difficult to expect a relatively small but talented Australian auto industry to work its way.
“It’s difficult to predict [when it will die] because it also depends on the supply base and as soon as you have a reduction in the scale of domestic manufacturing – let’s assume one of the three decides to exit Australia in terms of manufacturing – then you end up potentially with a sub-scale supplier infrastructure. Once that happens, I think it’s a domino effect,” the AFR reported.
Nasser also said the industry could have stayed viable if the government had given it more subsidies.
Holden recently announced 500 job cuts in its Australia, only weeks after it was revealed that it had received $2.17 billion in government funding over 12 years.
“I’d say we haven’t spent a lot on it when you compare the incentives that the automotive industry has received to others. I don’t know whether that is the appropriate conclusion. Maybe,” he said, according to the AFR.
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