Car manufacturing could return to Australia via EVs, says Minister

Car manufacturing could be reborn in Australia in the coming years if we were to make electric vehicles here, a senior minister has said.

Minister for Energy and Climate Change Chris Bowen told a global clean energy forum in the US that he wanted to see an EV manufacturing sector set up in Australia which could produce cars for local and international markets.

The minister made the comments on a visit to Pittsburgh, Virginia, where he tested Ford's electric F-150 Lightning ute, which is not currently available in Australia – though its internal combustion engined twin is coming here next year.

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“We can make electric vehicles in Australia. Not only do I think that, so do the electric vehicle manufacturers,” Bowen told The Australian Financial Review.

“There’s work to do to make that more viable in Australia, but the economics of an electric vehicle are a lot different to the economics of making internal combustion engine [cars].”

“We have a range of policies which no doubt will be looked at in due course. I believe we can make key components of electric vehicles and indeed electric vehicles totally in Australia.”

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The policies Minister Bowen is no doubt referring to correspond with remarks he made at Australia's first EV Summit last month where he called the manufacturing of EVs overseas a "lost opportunity".

Specifically, talk at the summit revolved around battery manufacturing for electric vehicles. Currently, as a nation we dig up all the materials needs for battery production here in Australia – but we send most of them overseas.

Speaking at the event, Chris Bowen said it was a “lost opportunity for jobs and investment” and bringing it home could create 35,000 jobs and $7 billion worth of value across all sectors. He also revealed that, as a result, that is why the Government is implementing a National Battery Strategy and establishing a battery manufacturing facility in Queensland.

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Image: Tesla Model Y vehicles arriving in Australia, courtesy Tesla Model 3 & Y Australia

The topic is something Tesla Australia chief Robyn Denholm has long advocated for.

“Last year, Tesla bought a billion dollars worth of minerals. And 70 per cent of those came from Australia but we sent them off-shore to be refined and no value was added. A fraction of that comes back to Australia because of the way we’ve gone about the supply chain.

“It is not just up to Government, it needs to be public-private partnerships because we have the knowhow, we have the technology, we just need the will to actually move forward. It is a very real opportunity for Australia to actually participate in that and become an energy power.”

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Earlier this year the US passed the Inflation Reduction Act, which, in part, outlines tax benefits and subsidies for EVs.

Many of these are tied to the origins of the materials, such as whether they come from North America or countries like Australia that it has a free trade agreement with.

Australia’s local car manufacturing industry wrapped up in 2017 when Holden closed up its operations in Adelaide, with Ford shutting up shop in Melbourne the same year and Toyota in 2016.