Car Manufacturing Units of Australia and Japan Essay

Car Manufacturing Units of Australia and Japan - Essay Example During the time of federation, Australian states were symbolised as highly integrated economies, with only a few barriers to trade, except tariff. As Forster puts it, there were free flow of labor and capital as there were no barriers, and the economic institutions operated across a number of economies. Federation removed the barrier in between the states in Australia, namely, tariffs. With time, both political and economic union mitigated the influence of other policies, which might have acted as the non tariff barriers in between the Australian states. Thus, the combined effect of reduced tariffs as well as the harmonised inter state standards drew the Australian state economies closer to one another. (Irwin D. A., December 2005) Holden was a popular name in the car manufacturing industry in Australia in the 1950s and in the early 1960s. By the middle of 1950, Holden cars were exported into Middle Asian territories and Asia-Pacific. With the expansion in the overseas, this 'all-Australian car' was the nation's pride; therefore, it dominated the car market in Australia. (General Motors Holden, (1948 - 1976). Along with Holden, Valiant was also an important car manufacturing company in Australia during 1950 - 1980. Much of their popularity can be attributed to their unique models, engines, pacer, utility and drifter that made it a truly Australian car. (Valiant, n.d.) In the year 1980, the protectionist policies were discarded and the government of Australia opened up trade and market in between Australian and Japan. DFAT or Department of Foreign Affairs and Trade declared that Australia and Japan would be partners in multinational cooperation. The new government also intensified microeconomic reforms to coastal shipping and port in Australia along with reforms in the labor market, transport, energy and communications. Australian Government also aimed at strengthening the key bilateral economic relationships with other countries, with Japan being the most important one. At that time, Japan was also undergoing major economic reforms, and Australia encouraged Japanese Government to accelerate the reforms. Right at that time, Australian exports were also shifting to manufactures and services from commodities. (Downer A, June 1996) Japan also got the contract for manufacturing the popular car - Holden, and therefore, Japan started manufacturing Holden for Australia. In the year 1987, United Australian Automotive Industries was created to control the Holden-Toyota joint venture; the GM arm of it was named as General Motors Holden's Automotive or simply, GMHA. In the year 1988, Holden continued to demonstrate its leadership with the introduction of exciting car models incorporating engineering techniques, significant design and safety innovations. However, the joint venture was dissolved in the year 1995. (Holden History, n.d.) However, the market shares of Holden reversed after the year 2000. The shares dropped significantly in the year 2006 and General Motors announced job slash along with cut back production in the South Australian Plant. Holden also