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Revitalizing the Industry: Australia’s Opportunity with the Electric Vehicle Revolution?


Sales of electric vehicles are on the rise. Australian sales will double by 2022 to 3.8% of all new vehicle purchases, and goods up to 780% in the first two months of 2023 compared to a year ago.

In the United States, Europe and China, the market share of electric vehicles is much higheraided by increased government support. Such as the Automotive News magazine put it:

The electric vehicle revolution is not coming – it is already here.

And the revolution is accelerating. U.S. moves to adopt strict new vehicle emission standards could increase sales of electric vehicles tenfold. Old car factories have already been revived.

There will undoubtedly be flow effects in Australia, where the government is about to do just that publish a national strategy for electric vehicles and new emission standards for vehicles.

The rise of electric vehicles is creating significant job opportunities, especially for countries with experience in making cars, such as Australia. a Report 2022 labeled by the Australia Institute’s Carmichael Center as a “once in a lifetime opportunity” to revitalize the Australian car industry in an “environmentally and socially transformative way”.

Read more: A rapid shift to electric vehicles could save 24,000 lives and make us $148 billion better over the next 2 decades

But what is left of car production?

More than 34,000 Australians still work in the industry and make parts for international companies. Sections of the car factories – the last 2017 closed – stay in tact. “All the bones are there,” said a former site operations manager at Holden’s Elizabeth factory in 2021.

Toyota’s former plant in Altona, Victoria, even houses oneCenter of excellence” where products for the local market are planned, designed and developed.

However, to revive the industry, political and business leaders must act quickly and decisively. Developers have bought back the old Ford sites Wide meadows And Geelong in Victoria, along with Holden’s Elizabeth factory in South Australia. They have plans for a mixed-use future with a particular industry, but no specific plans for a return to making cars.

Other challenges include finding enough employees in a tight labor market after COVID and improving the skills of former auto workers, plus a host of brands that limit each model’s domestic market share.

The fragmented market problem could be solved if the industry focused on exports, especially for valuable car parts.

In terms of labor costs, plenty of electric vehicles – or their parts – are made in other high-wage markets. And as a high-wage industry, it has historically had few problems recruiting workers.

Read more: The number of electric vehicles in Australia doubled last year. What is the impact of charging it on a power grid that is under pressure?

So what’s happening in the US?

The American experience – where President Joe Biden has declared half of all vehicles sold there should be zero-emissions by 2030 – suggesting opportunities to convert existing facilities. Many electric vehicles are being made in factories that once made conventional vehicles, reviving parts of America.Rust beltin the process.

While Elon Musk proclaims Tesla’s flagship factory in FremontCalifornia, for thefactory of the future”, it is actually a former General Motors plant. It was later jointly operated by GM and Toyota. From 1962 to 2009, Fremont made conventional cars.

When Tesla took over the facility in 2010, it rehired many former employees. Since Tesla began production in June 2012, the same buildings have been used for a very productive Assembly line.

Tesla’s Fremont production line is located in a factory that has been making cars since 1962.
Jeff Chiu/AP/AAP

Read more: Increasing the market share of EVs to 67% of US car sales is a giant leap forward – but automakers can meet EPA’s strict new standards

General Motors’ compact electric vehicle, the Chevrolet Bolt, is made at a factory in Michigan where workers built 15 different models since the eighties. In addition to the Bolt, they build cars with internal combustion engines, including the Chevrolet Sonic. “Everything runs along the same line, AV, EV, Sonic,” explained team leader Quentin Perea.

Japanese manufacturers have also used existing facilities to transition to electric vehicles. Nissan’s groundbreaking Leaf does made in Smyrna, Tennesseein a factory that has been in operation since the early 1980s and is still making four conventionally powered SUVs.

Although not a fully electric car, Toyota’s best-selling RAV4 hybrid model is made in Georgetown, Kentucky. The plant has been producing petrol cars since the 1980s. It is more than 9,000 employees now build both hybrid and conventional models.

“Electric vehicles are great”, said Dan Turke, a 50-year-old worker in Warren, Michigan. “Someone has yet to build them.”

Some of these factories offer unlikely comeback stories. Like NBC reportedthe Fremont factory was “derided as one of the worst in the business, with reports of on-the-job drinking, high absenteeism, low morale, and even automobile sabotage.”

The company’s factory in Lordstown, Ohio, also has a checkered past. There was a famous strike against increased line speeds in 1972, and the factory was closed on several occasions. Now it is home to a monument GM battery factory – in collaboration with LG Energy.

The experience in the US also shows that governments have to spend a lot to attract investment in electric vehicles. In early 2022, new electric car maker Rivian – backed by Amazon – announced it would build a $5 billion factory, creating more than 7,500 jobs. Georgia offered $1.5 billion in grants to secure the facility.

Also in 2022, a Hyundai electric vehicle factory near Savannah, Georgia, received a government package worth $1.8 billion. The package included free land, property tax credits, and income tax credits.

The American think tank Good Jobs First has estimated state and local governments in recent years $13.8 billion in incentives to bring in at least 51 electric vehicle and EV battery factories.

These movements reflect a longer history of subsidies to lure foreign automakers to the US. Trailers to argue the long-term payoff is worth it. Jobs in the auto industry were well-paid, strategically important, and boosted the wider economy. Like an American business leader saidit is the “crown jewel in economic development”.

Australia must act decisively

In Australia, reviving the auto industry will require similar bold investment and risk-taking. Another recent Carmichael Center report closed Australia needs a “coordinated, systematic industrial policy for electric vehicle production” to take advantage of the “huge” and “exciting” opportunities.

Australia has crucial advantages, especially as a car manufacturer place high value on the availability of workers with experience in the sector. However, these workers are aging, as are the buildings in which they toiled. Time is of the essence.

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