ABBOTT'S DIRE MESSAGE TO QLD MANUFACTURERS

ABBOTT'S DIRE MESSAGE TO QLD MANUFACTURERS

FEDERAL Opposition Leader Tony Abbott (pictured) has visited a drilling and earthmoving equipment manufacturer in Yatala as part of his national anti-carbon tax tour.

Abbott used the visit to Digga Australia to reiterate the Coalition’s opposition to the Gillard Government’s proposed carbon tax.

“The carbon tax is going to make it very difficult for a business like this to continue in its current form. If we want manufacturing like this to continue, we’ve got to drop the tax,” he says.

“If the carbon tax goes ahead, this kind of equipment won’t be manufactured here – it will be manufactured in China under worse environmental conditions and with much greater emissions.”

Abbott says the negative effect of mining companies luring factory workers into high-paying jobs is partly offset by the higher demand for engineering parts.

“People can go and drive a truck for $120,000 plus in the mining industry – and it’s very hard to earn anything like that in standard manufacturing operations,” he says.

“On the other hand, there is a lot of manufacturing in this country, which is riding on the back of the mining industry. I’ve seen quite a lot of sophisticated manufacturing because of the market the mining industry is providing.”

Digga CEO Suzie Wright says revenue and profit has dropped in the past three years. The company acquired Universal Augers Australia (UAA) in mid-2010 and the Kanga brand in 2009 for an undisclosed amount.

“Our profit has dropped by 45 per cent in the last three years. Revenue decreased from $46 million to $38 million since 2010,” she says.

Wright says the high Australian dollar has contributed to the race to source cheaper parts from overseas.

“Heat treatment and laser-cutting use huge amounts of energy. If power prices rise, components will become too expensive to make,” she says.

“Ideally we want manufacturing to happen here; I want my kids to have a future here, but the way it seems we’re all going to be importers.”

Digga is currently buying castings and engines from abroad due to labour costs involved with local manufacturing and the lack of Australian-made parts.

The company views 2012 as one of consolidation.

Get our daily business news

Sign up to our free email news updates.

 
Whitefox Recruitment founder Luke Hemmings making strides as a careers leader
Partner Content
After relocating his Canberra-founded company Whitefox Recruitment to the Gold Coast la...
Whitefox Recruitment
Advertisement

Related Stories

ASIC secures its first court win for greenwashing against US giant Vanguard

ASIC secures its first court win for greenwashing against US giant Vanguard

The Australian corporate watchdog has caught out one of the world&r...

Medicinal cannabis group Althea shaves $1.5m from its cost base through staff cutbacks

Medicinal cannabis group Althea shaves $1.5m from its cost base through staff cutbacks

Australian-founded medicinal cannabis company Althea Group (ASX: AG...

Charter Hall snares 15pc stake in Hotel Property Investments for $97m from 360 Capital

Charter Hall snares 15pc stake in Hotel Property Investments for $97m from 360 Capital

Listed funds manager 360 Capital Group (ASX: TGP) has offloaded its...

The party’s over: Splendour in the Grass festival cancelled for 2024

The party’s over: Splendour in the Grass festival cancelled for 2024

Splendour in the Grass, Australia’s largest winter music fest...