Porter s 5 forces analysis and a life cycle analysis - why is the Assignment

Porter s 5 forces analysis and a life cycle analysis - why is the Australian Car Manufacturing Industry closing down - Assignment Example Although global and local economic conditions have played a major part in the death of the manufacturing industry, blame has also been placed on the many parties and factors involved. By studying the current state of the industry and using porter’s five forces analysis, we can better discern as to what the main drivers were that caused the ultimate death of the Australian automotive manufacturing industry. The Australian car manufacturing industry has become far too small to be sustainable for any particular manufacturer. Australia’s three car manufacturers Holden, Ford and GM all announced they would shut down their local manufacturing operations within nine months of each other. With the local economy facing harsh times it seems that with current size of the market and increased competition from imports has simply gotten too small to be profitable. As a matter of fact, the size of the market had gotten so small that all three companies began to rely on each other just to survive and stay afloat. It has been a long time coming, the death of the Australian auto manufacturing industry. Although, there have been many interrelated reasons that have caused the slow demise of the industry many individuals put the most of the blame on the federal government. It has been blamed for much of the troubles that have negatively affected local manufacturers from their low import tariffs. Many of the federal government initiatives such as their Free Trade Agreements with China and India, low import tariffs, and the controversial automotive financial bailouts have created an industry that cannot sustain itself. Others place the blame to the car manufacturer themselves that used the Australian government like their own piggybank to bail them out financially. Additionally, the federal government and their economic policy itself have created a nation with relatively high wages, strong currency coupled with the extremely low