Automotive Aftermarket Can Reduce Impact Of Industry Shutdown: AAAA Photo:

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Trevor Collett | Feb, 12 2014 | 5 Comments

The Australian Automotive Aftermarket Association (AAAA) believes the aftermarket can help to reduce the impact of Ford, Holden and Toyota’s departure from local manufacturing.

The association says if full growth potential of the automotive aftermarket segment is realised, the industry can absorb some of the excess capacity, skills and knowledge from employees of the three Australian carmakers.

AAAA Executive Director, Stuart Charity, said the aftermarket industry was not only successful in Australia, but growing.

“We already have a robust $5.2 billion per year aftermarket manufacturing segment, employing 21,000 people and earning $800 million per year in export sales,” Mr Charity said.

“This makes the aftermarket an ongoing and viable manufacturing segment. About 260 parts and accessories manufacturers operate across Australia in metropolitan and regional centres.”

Mr Charity said the majority of companies operating in the Australian aftermarket sell their products through channels beyond carmakers and their dealer networks.

“[Aftermarket companies] produce over 36 percent of all Australian automotive output, yet receive no government industry assistance and minimal export support, and they are not constrained by inflexible union driven enterprise agreements,” Mr Charity said.

“The aftermarket can also provide an alternative market for car component manufacturers prepared to adopt a new business model. While they have the technical skills and equipment, they must transition their management to focus on new customers in the reseller and retail supply chain.”

Mr Charity said the aftermarket industry had achieved international success by “moving up the value chain”, offering everything from service parts to specialty products, such as 4WD parts and accessories along with performance and motorsport components.

The AAAA is calling on the Federal Government to back the aftermarket industry, which it claims has followed the government’s preferred channel with a focus on exports.

“We don’t need more inquiries or lectures about ‘entitlement’. We do need consistent and long term policies to stimulate R&D and target new markets. These policies must be based on independent research and advice designed to foster economic growth across a range of industries.” Mr Charity said.

The AAAA’s call follows Toyota’s decision earlier this week to cease manufacturing at its Altona plant from 2017.

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