Packer card game is far from clear
Forget playing the tables or the slots. The biggest game in town is working out why James Packer's Crown is selling its 10 per cent stake in Echo Entertainment only a week after finally receiving regulatory approval to increase it to 23 per cent.
The first conspiracy theory is that Packer's had the wink and nod from the NSW government that his Barangaroo casino proposal is in the bag. Well-placed insiders disagree, saying the government is at least a month away from that decision.
Conspiracy theory two is that selling Echo shares will drive down the price and Packer can buy back in if Crown loses the bid for his Sydney casino/hotel.
That could be a dangerous play, as he would need to buy in from a standing start and take the risk Echo's other large shareholder, Genting, could gain approvals to increase its stake.
Once either are seen as buyers, the Echo share price would immediately spike. (Packer has previously publicly maintained he would hold on to his Echo position because it gave him optionality.)
Packer has already taken a haircut on the Echo stake, which he acquired for an average entry price north of $3.80, compared with Thursday's sale price of $3.20.
Sitting on the 10 per cent parcel until the NSW government reached a decision on Barangaroo made more sense.
Conspiracy theory three (which can't be discounted) is that Packer's Crown either wants or needs the money for a reason that has nothing to do with a second Sydney casino licence.
The maths on Australia's car industry are simple enough. The costs of manufacturing a car in Australia are twice that of Europe and four times that of Asia.
Economic Darwinism would have seen Australian car manufacturers extinct years ago but they have been kept on life support by successive state and federal governments.
There was a tide of grief when Ford announced it would disappear from local production in 2016 but it was rightly directed towards the 1200 workers who would lose their jobs.
No one seemed all that surprised. The prevailing view of most economists is that the government should sever the assistance drip and allow the industry to disappear.
But car manufacturing has been a "special consideration" case for governments for many years - protected initially by tariffs and, more lately, subsidies.
Australian governments are not alone in this obsession with retaining a local auto industry.
Indeed, Australia is one of the least profligate countries when it comes to propping up its local carmakers, despite Holden receiving $2.2 billion in subsidies over the past 12 years and Ford picking up $1.1 billion.
Those in favour of continued assistance take the view that the protection was aimed at retaining the infrastructure of small and specialised component manufacturers that support the car industry.
But this is only a part of government's main motivation. The larger part is the retention of jobs.
There is plenty of political logic in this but ultimately it just delays the inevitable, rather than encourage the innovation and skill to find new outlets in other parts of Australian industry.
While there may be some desire in some sections of the government to enhance subsidies to the remaining two local players, the reality is that it won't happen. Wayne Swan was making no such commitments and Tony Abbott has said he will take $500 million out of the green-car fund.
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