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Aussie PM pledges to never abandon auto industry

Australian Prime Minister Kevin Rudd announced a A$3.2 billion (US$2.18 billion) stimulus package for the automotive sector yesterday as he vowed to never abandon the industry.

As Australian automakers suffer a downturn in sales and the prospect of thousands of lay-offs because of the global financial crisis, Rudd said he would support car manufacturers “because we believe this industry has a future.”

The package goes beyond the A$3 billion already flagged by the government, bringing federal assistance to A$6.2 billion by 2021.

Rudd said higher gasoline prices and competition from foreign manufacturers, combined with the fact that vehicle emissions contributed to the air pollution blamed for climate change, were stacked against automakers.

“Some might say it’s not worth trying to have a car industry,” he said in Melbourne. “That is not my view. It is not the view of the Australian government and it never will be the view of any government which I lead. I don’t believe that car making is yesterday’s business or something better left to the Germans or Japanese.”

Under the plan, the government’s innovation fund will invest one dollar for every three automakers spend producing environmentally friendly, fuel efficient “green” cars over a 10-year period from next year.

The government would also co-invest in other research and development and new plants, he said.
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