Australia could emerge as a global electric vehicle manufacturing ‘powerhouse’, if only it could attract federal government support for the idea, and if emerging EV leaders could take advantage of Australia’s natural competitive edge in new materials and technologies.
New research from The Australia Institute’s Centre for Future Work, finds Australia has an opportunity to revitalise its car manufacturing industries, creating tens of thousands of high-quality manufacturing jobs.
It could do this by taking advantage of Australia’s natural abundance of EV materials, significant clean energy resources and existing manufacturing skills base.
“When it comes to creating an EV manufacturing sector, Australia enjoys advantages other nations would die for: rich reserves of lithium and rare earth minerals, strong industrial infrastructure, a highly skilled workforce, powerful training capacity, abundant renewable energy options, and untapped consumer potential,” Dr Mark Dean, the report’s lead author, said.
“And contrary to popular belief, we wouldn’t be starting from scratch. Thanks to the resilience of our remaining automotive manufacturing supply chain, a surprising amount of auto manufacturing work – including components, specialty vehicles, and engineering – still exists here.”
The new report from the think tank, titled, Rebuilding Vehicle Manufacturing in Australia: Industrial Opportunities in an Electrified Future, finds that proactive government support for an electric vehicle industry would likely be critical to any such industry getting a foothold in Australia.
With the Morrison government having been antagonistic towards electric vehicles and the accelerating shift from petrol-fuelled to electric transport, Australia has suffered from a lack of national policy and coordination on building its electric vehicle industry.
Australia lags behind many international peers on electric vehicle uptake due in part to the lack of support at a national level and the Centre for Future Work’s report says national coordination will be key to not only supporting electric vehicle uptake but also supporting Australia’s resources sector to take advantage of surging demand for new materials.
“Hence the challenge facing Australia’s decisions about its industrial future is ultimately one of moral values and political will. Australia can choose to pursue a renewed industrial future via an EV industry and its environmentally and socially transformative potential,” the report says.
“This would both address our climate change responsibilities and revive our strong industrial history, by making us a leading renewable energy and industrial innovator.”
For an electric vehicle manufacturing industry to be successful in Australia, it would require government support, such as using tax incentives to expand Australia’s production of key minerals and attracting international vehicle manufacturers to establish a manufacturing base in Australia.
Government across all levels also have significant buying power that could be used to underpin early demand for electric vehicles, such as mandating a transition of government vehicle fleets to electric models.
“No nation builds a major industry without its government taking a proactive role. Our new research shows there’s no excuse for inaction because there are a huge range of powerful levers our government could be pulling,” Dean added.
“If we capture the moment, we’ll capture abundant benefits: creating tens of thousands of regional manufacturing jobs, reducing our dependence on raw resource extraction, reinforcing our accelerating transition toward non-polluting energy sources, and spurring innovation, research, and engineering activity in Australia. We just need our government to act.”
In their recent assessment of global clean energy investment, BloombergNEF found the electric vehicle industry is experiencing stunning growth – with global investment growing to US$273 billion (A$385 billion) in 2021, a massive 77 per cent increase on the previous year.
Through its report, the Centre for Future Work makes a series of recommendations for how Australia can ensure it benefits from this growing economic opportunity, including calling for the establishment of a dedicated ‘EV manufacturing industry commission’ to undertake an inquiry into Australia’s PV potential, and ensuring any EV industry is powered by low cost supplies of clean energy.
The report also calls for Australia to expand its ability to ‘value-add’ the raw materials which Australia has an abundance of, such as supplies of lithium and rare earth minerals, to capture the increased value of processed materials that may otherwise be exported in their raw form.
“Hence the challenge facing Australia’s decisions about its industrial future is ultimately one of moral values and political will. Australia can choose to pursue a renewed industrial future via an EV industry and its environmentally and socially transformative potential,” the report says.
“This would both address our climate change responsibilities and revive our strong industrial history, by making us a leading renewable energy and industrial innovator.”
