The current conclusions by Ford, Holden and Toyota to stop production in Australia have raised serious issues for the tens of thousands of Australian companies who are employed in the automotive supply chain. Producers are asking themselveshow.
Some providers service other niches, so their companies may persist, albeit with a smaller client base. Nevertheless many providers are vulnerable and extremely determined by the quantity from the automobile industry for their own survival.
These business owners should decide whether to end upward, or to enhance their company so they can fill out the gap.
In CSIRO we’re exploring the idea of diversification for its small and medium companies in Australia’s automotive supply chain. CSIRO has the most significant manufacturing invention application in Australia, partnering with producers to help resolve technical challenges, enhance processes and products and create new technologies.
Our intimate relationship with business has enabled us to create a broad picture of these challenges Australian producers are facing. In addition, it provides us the chance to play a critical part in helping producers innovate, diversify and transition into new markets.
The largest misconception concerning diversification is that there’s but a means to do it. In reality, diversification may take several forms diversifying into various supply chains and international markets, as well as diversifying products, processes and business models.
Producers that branch out into other businesses mitigate the dangers that have restricting themselves to a single distribution chain.
One firm that has always done this nicely is Marand Precision Engineering. A vital supplier to Australia’s automobile industry, Marand is currently branching out into aerospace, defence, mining and railroad, with automotive industry now representing less than 10 percent of its earnings.
The vital question this company asked itself is: do the parts we manufacture always must go to a vehicle. The easy answer was no. Marand’s specialisation is not in automotive distribution instead it’s precision technology abilities which could be implemented elsewhere to unique niches.
Diversification does not need to be moving to new businesses. Melbourne-based company MtM was set as Melbourne Tooling Co half way during last century, developing to fabricate and design elements such as Ford, Holden, Toyota, Nissan and Mitsubishi.
The business recently established the Tomcar, a challenging off-roader that’s all about customisation focusing on niche market segments such as agriculture, mining and tourism – that may be covered through the cyber-currency Bitcoin.
A number of these challenges confronting our automotive sector such as a top Australian dollar are unique to Australia. That is why it’s essential for organizations to try to remember that manufacturing is a worldwide business enterprise.
The business has taken advantage of this international market, providing chairs, trims and upholstery to automobile manufacturers around the globe.
As firms should not restrict themselves to a single supply chain or area, occasionally it’s the product that offer that has to be diverse. On the other hand, the organization’s inherent expertise in thermodynamics has enabled it to move into battery pack designs for electrical vehicles.
Firms that know what they are really effective at will be resilient and flexible to changing market requirements.
AW Bell is a family owned and operated company that’s been servicing Australian producers with metal components for more than 50 decades.
Collaborating with CSIRO throughout the investigators in Business plan, AW Bell developed a new procedure that enabled it to fabricate complicated, lightweight aluminum components quicker and more economical than traditional practices.
This step change in capacity has enabled the company to be a provider to the international defence and aerospace businesses. Whenever it’s widely agreed that diversification can offer alternatives for our automobile providers, there is the small matter of time.
The normal time for a company to successfully interpret a chance to reality is just five to ten decades. This is the point where a collaborative programs and exploiting experience are needed. The businesses which handle this challenge head on are those who successfully make the transition.