Essays on The Government-Business Relationship in the Australian Car Industry Case Study

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The paper "The Government-Business Relationship in the Australian Car Industry" is a good example of a business case study.   In an industry like car manufacturing, the relationship between the government and business involves policies, tax regulations, and financial support. The car industry is characterized by various business needs that mostly require immediate intervention from the government. A stable basis for the operation of this industry is established when relevant legal policies and frameworks are formulated. In the pursuit of step changes, car manufacturing executives lobby the government to influence the nature of its operation.

In this industry, the Australian government is responsible for formulating consumer protection legislation and the promotion of free competition and trading (Productivity Commission 2014). Regulations will govern the kind of interaction among customers, suppliers of raw materials and the government. This paper examines the government-business relationship in the car industry taking into account international and domestic contexts. Discussion The Australian car manufacturing industry is a collection of about 100,000 businesses under the management of the Australian Motor Industry Federation (AMIF) that has employed over 320,000. The industry is estimated to generate a turnover of $208 billion from car sales, car collision repair, used car sales, parts recycling and tire and fuel retailing (Productivity Commission 2014).

Currently, the industry is struggling to adjust accordingly to meet the requirements and specifications of the global market. These requirements have been instigated by globalization effects, rapid technological advances, changing skill requirements, changing consumer demands and environmental protection policies (Hair & Lukas, 2014). The government-business relationship in this industry is revealed in these reformations. As such, there are significant aspects that are governmental, and some are unitary.

But according to Rimmer et al. (2014), the government is affiliated with the car industry because it is a business that can generate income and employment opportunities. Since Australia is a capitalist society, profit is the main aim of the car manufacturing industry. As of 2014, the industry suffered a loss of AUD $1.5 billion (Productivity Commission 2014). This created huge debts in this sector that never met the supply-demand law. In this situation, the government intervened to create a free market economy by regulating car sells to prevent losing the company overseas.

The government has also been struggling to revive the industry as popular companies such as Toyota, Ford and Holden have threatened severally to exit the industry and conduct their businesses overseas. The companies have cited changing consumer preferences, high competitive domestic market and a high cost of manufacturing (Dunning, 2014). Regarding this, the government is a key provider and controller in this industry. Some of the efforts that the government has been making include the enactment of various programs like the Automotive Transformation Scheme (Dunning, 2014). In enacting the ATS, the government was focused on a kind of legislation that would easily encourage innovations and competitive investments in the car industry.

It is approximated that this program will generate both capped and uncapped assistance with an estimation of over $2.5 billion and $337 million respectively (Productivity Commission 2014). ATS would foster the government's efforts to offer specialized training to automotive workers. The program would also guarantee labor adjustment to ensure that only quality car products that meet customer demands are produced. The ATS would serve to ensure that the supply chain is correctly managed and controlled so as to retain manufacturing capability in Australia.

This strategy was widely accepted by the Growth Fund, which had recognized the efforts the government was making towards the resumption of the car industry.


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