Why Australia needs to restart car manufacturing

When the last Holden Commodore, a manual SS-V Redline sedan, rolled off the production line in Elizabeth, South Australia on October 20, 2017, it marked the end of nearly a century of local car manufacturing. At its peak in 2004, Holden built 165,000 cars. Record production levels from the other big two were not far behind at 155,000 for Ford (1984) and 148,000 for Toyota (2007). In 2002, the Holden Commodore was Australia’s most popular car with sales of almost 90,000.

For context, the total sales for Holden’s entire range in 2018 (now fully imported) were just 61,000. To emphasise, total sales of Holden cars were 30% lower in 2018 than that of a single Holden model back in 2002.


Above: The VFII Holden Commodore - the last car to be mass produced in Australia

Various reasons have been cited from industry sources, both sides of politics and a whole host of other experts for the demise of local automotive manufacturing. To surmise, these have included:

  • A small domestic market. Although Australians tend to have high rates of car ownership, our small population made the industry heavily export dependent, as domestic sales were insufficient to profitably sustain the industry.

  • Geographic isolation. With Australia far away from major automotive markets such as the EU, America and China, exporting vehicles to these regions was expensive, with high shipping and freight costs.

  • High wages & government-union relations. Compared to areas such as Thailand and India, the Australian car manufacturing workforce had much higher wages. Combined with the two reasons above, this made Australian made vehicles expensive to sell elsewhere.

  • Protectionist tariffs. These tariffs were important in making domestic car production viable by enticing fleets and government to buy Australian-made vehicles. Nevertheless, a counter-argument can be made that by reducing competition and becoming dependent on fleet sales, they made domestic manufacturers sluggish, and less willing or able to innovate and adapt to changing market conditions, especially in light of FTAs (free-trade agreements) signed with other countries.

  • Trade deals and ‘more suitable’ cars from overseas. Free trade agreements signed with countries such as Thailand made certain imported vehicles just as inexpensive to buy as locally made vehicles. Often, these cars were more fuel-efficient and cheaper to run than their domestic counterparts, or available in popular body-styles such as SUVs (Ford Territory excepted) that weren’t available through local production. On the other hand, whilst FTAs ostensibly made it cheaper to export Australian made vehicles overseas, these were substituted by ‘hidden’ tariffs that made it difficult to sell Australian vehicles. For example, whilst the Australia-Thailand FTA removed import tariffs from the Thai perspective, Thailand retained tariffs on vehicles with large engines. As Australian made vehicles fell foul of this ‘large engine capacity’ barrier, they practically remained expensive to sell in Thailand.

  • Exchange rates and oil prices. This issue became especially prevalent in the early 2010s as the Australian dollar was close to (and sometimes above) parity with the US dollar, thus further increasing the cost of exporting vehicles. Coupled with high oil prices, this made domestically produced cars, with their typically large engines and high fuel consumption, expensive to run.

Above all, perhaps what can be said is that the decisions by Ford, Holden and Toyota to cease local manufacturing were justifiable decisions. They weren’t absurd or irrational, they could be explained by logically examining the reasons summarised above.

The skills perspective - the car as the ultimate mobile device

Much of the rationale described above is still applicable today. However it’s important to note that fundamentally, the car of 5 or 10 years into the future will be vastly different from the Holden Commodore that rolled off the line back in 2017.

Cars of the past could be categorised as discrete mechanical engineering projects, with the focus squarely on designing, building and testing parts such as the chassis, engine and body. The car of tomorrow will use this as a basis, but - as summarised by Daimler - will also be connected, autonomous, shared and electric.

What does this mean? The automotive industry will increasingly require not just mechanical engineers, but also skill-sets in software and robotics, as vehicles become increasingly digital and autonomous, and developing software becomes integral to a model’s success rather than an afterthought. Just as important will the skills of designers in making this technology accessible, and marketers in working out how people will use their cars through services such as ride-sharing in the future.

Australia is known over all over the world for punching well above its weight in terms of education. Despite our small population, we have eight universities ranked in the world’s top 150. We clearly have the talent to bring significant innovation to each of these fields mentioned above. As described by an executive from a prominent technology company, restarting production of the ‘ultimate mobile device’ will significantly increase opportunities for STEM careers in Australia, and much like a reverse chicken-and-egg situation, greatly improve this skill-set amongst young Australians.

Although the prevailing short term economic conditions (as discussed above) mean that car manufacturing in Australia will likely remain unprofitable, I think we need to shift our perspective to a long-term, skills based mindset. Our society is on an unstoppable march to becoming digital, and that means the importance of STEM skill-sets, together with business acumen, will only increase in proportion. The car is the ultimate mobile device - a marriage of cutting edge digital software and robotics technology together with traditional mechanical engineering nous. More than anything, it is a true demonstrator of a country’s technological prowess. Germany is known as an engineering giant due to the quality of their vehicles. Similarly, work by Tesla, GM and Google on computer vision and robotics has led America to be known as the leader in autonomous driving technology. With the talent and skills that we have, Australia too can make its mark if we realise that a domestic car manufacturing program can be a lens through which our STEM skill-set can be developed.

Car and Driver test of AEB systems

American automotive magazine Car and Driver recently undertook a series of comprehensive tests of Autonomous Energy Braking (AEB) systems, involving the Subaru Impreza, Toyota Camry, Tesla Model S and the Cadillac CT6. Four types of tests were undertaken:

  • Closing in on a stationary car

  • Target switching to a stationary car

  • Maximum deceleration

  • Approaching a slower moving vehicle

The article is excellent and definitely worth reading in its entirely. The key takeaway I found was that despite AEB systems ostensibly claiming to achieve the same goal of preventing, or at the very least mitigating the impact of a collision with another vehicle, the performance of such systems varies substantially and is often not dependent on the class or price of the vehicle. For example, the Subaru Impreza’s EyeSight stereo camera system outperformed the other vehicles on test despite being the cheapest to buy.

In the U.S. at least, another takeaway is the state of legislation in relation to AEB systems. The NHTSA (National Highway Transport Safety Administration, effectively America’s equivalent to ANCAP) has a very basic requirement in order to satisfy its AEB test which most vehicles today can easily meet. These requirements should proactively become tougher, to further compel manufacturers to invest more in AEB systems and additional capabilities such as pedestrian and cyclist detection.

X marks the spot: Toyota Corolla design

Toyota recently unveiled the all-new 12th generation Corolla. Let’s go through its design and see why it’s a clear step up over its predecessor.


The design of the new Corolla is in line with CEO Akio Toyoda’s vision for Toyota vehicles to be less bland and more characterful. Indeed, Kevin Hunter, president of Toyota’s American Calty design studio, confirmed that the company wants to progress with more emotional designs and move on from a widely held perception that it makes inoffensive whitegoods on wheels.

The face

Above top: The superseded Corolla, known in Europe as the Auris

Compared to its predecessor, the new Corolla presents an aggressive face that is a stark departure from its predecessors. The two key elements here are the hidden bumper and the headlamps. The front bumper has cleverly been painted black and is camouflaged behind mesh, creating the illusion of a large, gaping grille. Together with the slim, downwards angled headlamps, this creates an aggressive ‘X’ design across the front of the car, in line with other recent Toyota models and helping to develop a family design language.

Above left to right: The new Corolla, Aygo, Yaris, C-HR and Camry. These models all use an aggressive front design incorporating an ‘X’ graphic to develop a shared family resemblance.

The sides and rear: more balanced proportions

The 12th generation Corolla continues its predecessor’s cab-forward design, with a minimal dash-to-axle ratio and the base of the A-pillar positioned almost on top of the front axle.


The key improvement, however, is in the treatment of the side profile. The older model implemented a single crease which acted as a half-hearted attempt to break up an otherwise slab-sided design. In contrast, the latest Corolla implements a curved secondary character line that flows from the front of the rear door handle, across the C-pillar and into the tailgate. This crease has the effect of accentuating the rear haunches, and together with the more steeply raked rear windscreen, helps develop the sense that the new Corolla has a more protruding, substantial rear end. When taken into consideration with the rest of the side profile as a whole, this develops an illusion that visually elongates the car and helps balance the otherwise cab-forward design.

Above left to right: Corolla, 2018 Renault Megane RS, 2014 Renault Megane Coupé

The tail of the new Corolla is in harmony with the front of the car. Angled character lines that extend from the rear bumper reflectors into the tailgate, together with the blade like tail-lamps and curved rear windscreen work together to develop an ‘X’ graphic that mirrors the front of the vehicle.

Of note is the inspiration Toyota has derived from the Renault Megane for the design of the tailgate. In some respects, the new Corolla is an amalgamation of both 2014 Megane Coupé and the 2016 Megane. The steeply raked, curved windscreen has a clear lineage to the Megane Coupé, whilst the slim tail-lamps extend far into the tailgate to serve a secondary function that visually widens the car, in a fashion similar to the 2016 Megane hatch.


The new 12th generation Corolla successfully achieves its objective of presenting a more aggressive, characterful design, in line with the vision outlined by CEO Akio Toyota. The use of an ‘X’ graphic across both the front and rear, together with a more balanced side profile incorporating character lines to emphasise the rear haunches and tail, creates a very cohesive design. With the right combination of trim and colour, the new Corolla is a desirable and compelling option in its segment.

Mazda and Toyota to collaborate on electric vehicle development

Hans Greimel, writing for Automotive News:

"Toyota will take a 5 percent stake in Mazda, while Mazda reciprocates with a token 0.25 percent stake in Toyota, the car manufacturers said in a joint statement Friday.

Toyota and Mazda said they will also collaborate in developing electrified vehicles and connected car technologies. They will also step up supplying vehicles to each other.

In electric vehicles, Toyota is being positioned as working on the battery-side of electric vehicles, while Mazda works on the overall architecture. The two companies will jointly develop the hardware and software sides of electric vehicles but produce them separately, Toyota Executive Vice President Shigeki Terashi said at a joint press conference in Tokyo.

In connected cars, Toyota and Mazda will cooperate on vehicle-to-vehicle and vehicle-to-infrastructure communications, seen as a key toward self-driving and advanced safety systems."

This appears to be a beneficial move for both parties.

For Mazda, it represents a cost-efficient and potentially time saving strategy to jump on the electric and autonomous vehicle bandwagon, by leveraging Toyota's greater resources and battery expertise, whilst retaining control of overall design and vehicle development.

Toyota, in turn, can make use of Mazda's product development and engineering expertise that has been responsible for the famed handling qualities of its SkyActiv architecture. This partnership is sure to also complement Toyota's existing collaboration with BMW on battery development and lightweight materials.