Positive results for automotive industry transition support
The initial outcomes of transitional programs for the automotive industry was released in a report on 17 December 2019.
Transition support for workers and supply chain businesses was introduced following closure announcements of the Ford, Toyota and Holden production plants in 2013 and 2014.
Early results of the transition support provided through government-funded programs is encouraging.
Of those businesses that participated in the Automotive Transition Scheme, about 75% remain in business, albeit with reduced workforces.
Ford, Toyota and Holden allowed a 3-year transition to wind down their operations. This allowed for supply chain businesses to transition and diversify their business.
The Australian, South Australian and Victorian governments designed complementary transition plans to support supply chain businesses to plan, re-invest and develop new capabilities and markets.
Governments and car makers also recognised the significant impact on workers and their families, with funding available to support workers to transition to new opportunities.
The report identifies a number of lessons learned:
- Businesses that received transition support generally fared better than those that didn’t.
- Australian-owned businesses are more likely to successfully diversify and expand than multinationals.
- Early diversification assistance contributes to business survival, but expect businesses to downsize as they adjust to the transition.
- Transition support is more effective if provided continuously rather than in rounds.
- Businesses need assistance for a range of activities to transition successfully.
Key business characteristics to enable successful transition are:
- an awareness and ability to anticipate the business landscape
- business leadership possessing a growth mindset
- an ability to apply existing skills to diversify into new markets
Additional success factors include:
- an effective partnership between governments and the participating multinational companies
- employee reskilling should underpin business capital investment
Read the full automotive industry transition report.
- The Minister released the Australian Automotive Industry report on 17 January 2020
- See how we are transitioning Australia’s automotive manufacturing industry
Contact us for more information.