Appoint a tsar for cars, urges industry veteran
Ivan Deveson was not surprised by Ford's announcement this week that the US car maker was finally shutting down its Australian operations. Disappointed, a "little bit angry", but not surprised.
Deveson, the former head of General Motors Holden, was running Nissan Australia when the decision was made in Tokyo to close that business - an event that sparked his resignation as chief executive and his departure from an industry he'd served for nearly four decades.
More than two decades later, Deveson bemoans the lack of political will, bipartisanship and understanding among Australian policymakers he says are needed to keep manufacturing viable.
He argues there are many reasons for Australia to cling on to its manufacturing base - including car manufacturing: "Technology, defence production, manufacturing expertise - and of course jobs and exports."
The former Melbourne lord mayor, who has also served as a director for some of Australia's biggest listed companies, is calling for Australia to follow the Obama administration's approach in its rescue and restructuring of General Motors and Chrysler in the US - the appointment of an "automotive tsar" and the setting up of an auto-industry taskforce, to oversee "every penny" in support given to car makers.
Deveson says the crisis in manufacturing also warrants the appointment of a manufacturing, rather than an industry, minister. "If we are going to hold on to the last two [car makers], and the component suppliers, we need someone 24/7 on manufacturing.
"We need the automotive tsar, we need the true minister for manufacturing and we need people who understand how the car industry works worldwide, so that every penny of taxpayer money that's put towards support should be identified for what purpose and followed through to be sure that purpose was accomplished," he says.
"I don't think there's enough homework done on where the money is going and what is its long-term effect on the stability of the industry."
Deveson worked for 37 years in the car industry, 32 of them at General Motors, where he started as a manufacturing cadet, before rising through the ranks with stints in Detroit, South Africa and elsewhere, and ending up as head of General Motors Holden.
He later served as chairman of the Seven Network and a director of companies including the Commonwealth Bank, United Group, Crane and Mt Isa Mines, and was lord mayor of Melbourne for three years in the late 1990s. His not-for-profit roles included director of North Melbourne Football Club and patron of Melbourne Citymission. His biography, published last month through Melbourne Books, includes an account of his years at GM and the Nissan shutdown - an event he blames, in part, on the Button plan of the 1980s that aimed to foster a more viable and efficient car industry while reducing tariffs.
Deveson supported the Button plan at the time - and remains an admirer of its author, the late John Button - but in hindsight believes it was a mistake to saddle car makers with volume requirements for unit production, enforced with fines. Two decades later, governments are handing over millions of dollars of taxpayer-funded assistance to keep them in the country.
But he acknowledges that, when it comes to the Nissan retreat from Australia, "market forces may have finished up with the same result".
Deveson has sworn off the protectionism that he once supported, believing that being "up against the wall" boosted the quality of vehicles produced in Australia. "It caused everybody to work smarter and harder," he says.
But he is in favour of properly administered industry assistance, arguing that among the 19 or so countries that make cars, "all of them receive support in some way from their governments".
He has also called for measures to bring down the Australian dollar, still at historic highs despite its recent fall below parity.
"I think it's wrong that we play by so many global rules, whether on trade regulation or currency management, and others just go for the jugular, and Aussie workers, investors, exporters suffer severely."