Automotive Supplier Diversification Program

The Hon. J.M. GAZZOLA (14:33): My question is to the Minister for Manufacturing and Innovation. Can the minister update the chamber on how the Northern Economic Plan is assisting automotive component suppliers diversify to take advantage of emerging opportunities in the manufacturing sector?

The Hon. K.J. MAHER (Minister for Employment, Minister for Aboriginal Affairs and Reconciliation, Minister for Manufacturing and Innovation, Minister for Automotive Transformation, Minister for Science and Information Economy) (14:33): I thank the honourable member for his question and his very strong interest in the automotive sector and cars, and muscle cars in general.

The state government's Automotive Supplier Diversification Fund is an $11.65 million initiative designed to assist automotive supply chain manufacturers impacted by the closures of Ford, Toyota—and particularly Holden which is slated to close at the end of 2017. Through the program eligible South Australian companies are being supported to diversify and secure alternative revenue streams to transform their business.

Members may be aware of some of the significant support provided through this program to a number of supply chain companies. To date there have been some 10 grants to a range of companies committed to a prosperous future after whole automotive manufacturing in Australia comes to an end. Quality Plastics & Tooling received $495,000 for a project to expand their product range into food, cosmetics and other non-auto industries; ZF Lemforder Australia received $450,000 to transition their business to manufacture the air tip vehicle; and Trident Plastics were awarded $500,000 to invest in new tooling to meet demand for a range of plastic components that are currently being imported.

As I outlined yesterday in an answer, in response to a question about supporting supply chain workers, we know that we must change and meet and adapt to the times and the needs of companies as conditions change in the South Australian economy, particularly in the automotive manufacturing sector. That is why, as part of the Northern Economic Plan, I announced a range of amendments to the Automotive Supply Diversification Program that will ensure more companies have greater capacity to access support through the program.

This includes removing the 20 per cent exposure threshold for support, which means that any manufacturing company directly impacted by the Holden, Ford or Toyota closures is now eligible for funding support. We have also removed the $500,000 cap on available assistance, to better support those automotive component suppliers that have proven diversification strategies in place. The changes will also allow non-automotive companies to access funds to partner with automotive supply chain companies on projects that retain automotive supply chain jobs and keep capital equipment in use.

As I said, we understand that the circumstances for many companies are changing as the closure of Holden draws nearer, and we recognise that to support the transformation of the state's economy we need to make our programs as flexible as possible to make sure that they fit the circumstances. Indeed, members may have heard today that my good friend the Minister for Investment and Trade—

The Hon. D.W. Ridgway interjecting:

The Hon. K.J. MAHER: —he's a very good egg and a great advocate for this state—talking this morning about one of the early successes of the Investment Attraction Agency.

The Hon. D.W. Ridgway interjecting:

The Hon. K.J. MAHER: We hear interjections from what many people describe as the next Liberal candidate for Waite, if he's got the guts to challenge it and actually run in that seat.

The Hon. D.W. Ridgway: I could do it with both hands tied behind my back.

The Hon. K.J. MAHER: I think the Leader of the Opposition in this council has just declared that he is no longer a candidate for Liberal Party preselection for the Legislative Council because he has put himself forward in Waite, which many of his colleagues will be very pleased with because there is a vicious fight going on at the moment with some of the members opposite.

My good friend, that good egg and great advocate, minister Martin Hamilton-Smith, the member for Waite, talked this morning about one of the early successes of the Investment Attraction Agency. ScreenAway is partnering with automotive supply chain company Adelaide Tooling to manufacture a unique retractable flyscreen and blind system. I understand the partnership means that 100 per cent of the fabrication will now be done locally. I am told that all of the products used to construct the screens are sourced from Australian companies.

It is expected that around 300 jobs will be created over the next two years and about 30 workers from Adelaide Tooling will again be transitioning from the company's automotive business to ScreenAway, with another 70 workers to be employed to work on the product over the next couple of years. A further 200 jobs are expected to be created during this period, either internally at ScreenAway or through other suppliers. This is a great example of what governments and industry can achieve when they work together using innovation as a means of transformation.