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Australian car manufacturing to drop 20%

Staff writer ▼ | July 30, 2013
Australian government's changes to Fringe Benefits Tax (FBT) rules will impact local car manufacturers twice as much as imported brands, according to the Federal Chamber of Automotive Industries (FCAI).
Australia cars
Australia carsAustralian government's changes to Fringe Benefits Tax (FBT) rules will impact local car manufacturers twice as much as imported brands, according to the Federal Chamber of Automotive Industries (FCAI).


The Federal Chamber of Automotive Industries has expected a 10 percent drop in new-car deliveries as a result of the changes to FBT and that could wipe $3.4 billion in vehicle sales each year. However, sales of locally made cars by Toyota, Holden and Ford are expected to go down by 20 percent, or twice the industry average.

The FCAI made the forecast as the offices of the Federal Treasurer Chris Bowen and Federal Industry Minister Kim Carr confirmed there are no plans to reverse or modify the controversial changes to company car tax rules, announced on July 16 and which came into effect immediately.

The changes have already cost 300 jobs in the car leasing and salary package sectors and another 3000 are at risk.

"This is terrible news for car makers - importers and local manufacturers - who rely on volume to be viable in this country," FCAI chief executive Tony Weber said.

The FCAI said the changes will not impact manufacturers alone, however, foreshadowed a strong impact on the entire car industry.


 

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