Page 4 - Australian Defence Directory 2019 #51

KATHERINE ZIESING | CANBERRA
Manufacturing is not dead
SITTING OUT the Avalon air show for the first time since I joined the ADM team due to injury made me somewhat nostalgic. So I referred to my archives to see what ADM was writing about five years ago as an editorial. I was on maternity leave at the time so ADM’s Deputy Editor Nigel Pittaway spoke of the importance of manufacturing.
To remind you of the context at the time dear readers Land 400 was still a dream, the car industry was in its death throes and the Valley of Death for shipbuilding was all anyone could talk about.
“There has also been a detectable public reluctance to continue subsidising a motor vehicle manufacturing industry that is losing money and this sentiment has no doubt been noted by the government,” he reflected.
“But what will happen when these industries finally close their doors? Apart from the
emotive aspect of the loss of hundreds
of jobs and important skills, what will
be the impact on other industries, the Australian economy and the expecta- tions of ongoing high
standards of living?
“Some in the naval shipbuilding industry will tell you that the Valley
of Death moniker doesn’t accurately describe the current state of play, as
it suggests there may be a way across. Many will argue that it is already too late, even if projects are brought forward, and the situation should more accurately be described as ‘The Cliff of Oblivion.’”
Fast-forward five years and the landscape is vastly different. We did in fact not fall off a cliff. Yes, we peered into it intently and thought about what comes next and that looked like the Land 400 industry roadshow, which we jumped into. Both Rheinmetall and BAE Systems conducted a massive nation wide fact finding tour to see what was out there in terms of the local supply chain.
Companies came out of the woodwork to participate. This format has now become the norm for large pro- grams, with every shipbuilding program certainly on the roadshow bandwagon. Industry to industry and defence to industry briefings are more frequent, and in many cases, are now more useful.
The shipbuilding Valley of Death wasn’t bridged per se but it was navigated more safely than first imagined. The plan in place for continuous naval shipbuilding is not perfect but it will see a generation of shipbuilders and
designers across all trades supported for years to come. So while the traditional car manufacturing industry
has passed away, there are still companies working on vehicles thanks to the ongoing support of the current fleet, the Hawkei program and Land 400. There are less of them of course but one could argue that those that are left are more efficient and productive. They have to be in order
to remain in a reduced market. Rumours of the death of Australian manufacturing are overstated; it’s smarter and more niche.
Land 400 Phase 2 will see a fleet of vehicles made here with this phase of the program looking at roughly 60 per cent of Australian Industry Capability (AIC) in the mix. Rheinmetall is in the process of developing its Military Vehicle Centre of Excellence (MILVECOE) in southeast
Queensland that will act as a hub for the region.
Phase 3 bids will be in the box well and truly by the
time this edition hits your desk or screen but you can bet that AIC will have a large role to play. Any bid that doesn’t have this squarely in their sights alongside an amazing capability will simply not stand up.
AIC has become such an important part of programs for both acquisition and sustainment. Any company, local or international, that can’t demonstrate how they’re engag- ing the local supply chain is just not in the running.
As announced at ADM’s Congress in February by then Minister for Defence Industry Steve Ciobo the threshold for program requiring an AIC plan has dropped from $20 million to $4 million.
The real test will come when a program does not live up to the promised AIC plan or deed. What are the consequences for this I wonder?
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ADM’s Directory of Defence Suppliers 2019 | Edition 51 | www.defencesuppliers.com.au
“AIC has become such an important part of Defence programs. Any company, local or international, that can’t demonstrate how they’re engaging the local supply chain is just not in the running.”
EDITOR’S FOREWORD