Australia's automotive manufacturing industry directly employs more than 45,000 people across Australia. This represents over 5% of manufacturing employment. The components sector is the largest part of the industry, employing 29,000. It is estimated that a further quarter of a million jobs are derived from activities supporting the manufacturing of cars in Australia.
Employment is concentrated in Australia's southern states. In NSW the automotive components industry employs 4000 people. In South Australia the industry employs 5000. The industry in Victoria employs 20,000 and turns over an estimated $4.8 billion dollars every year. People are the heart of any industry but in the automotive industry this is doubly true.
Meeting the technology, quality and price objectives of consumers has demanded a highly capable and motivated workforce. The automotive industry is at the forefront in the adoption of best practice management technologies.
Component manufacturers have recognised the necessity to maintain and improve the skills of their workforce by instituting comprehensive training policies and programs. The use of work teams with flat management structures is standard practice in our firms.
Continuous improvement is embedded in the culture of all Australian automotive manufacturers. The principle is quite simple - no matter how good you are you can always improve. FAPM uses a self-assessment method of determining the industry's own view of where future improvements can be made and which issues should be tackled first. Each time the industry moves close to the target of best practice we simply move the target.
Ten years ago quality was measured in parts per thousand, next we used parts per million now we expect zero defects. The automotive industry is recognised as a leader in the use of autonomous work teams and the concepts of Quality Circles and Kaizen (continuous improvement) elements of which are frequently found outside the automotive industry. In the automotive industry, quality is determined by people not machines.
Two things occur when a rejected part is detected. Firstly no more value is added to the part and secondly a thorough investigation is undertaken of how the production system failed. This process involves constant measurement which includes checking tolerances and machine settings and charting the results. In the past decade we have seen customer reported faults in Australian-produced motor vehicles drop dramatically to the stage where we now outperform much of our import competition.
While the automotive manufacturing sector in Australia has invested over nine billion dollars in new capital since the commencement of the current car plan in 1984 we credit most of the improvements in our quality and productivity to our people.