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Recession or transformation: car makers' aftershock

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The political brawl over the demise of Australia’s car makers stepped up today in the aftermath of Toyota’s announcement yesterday that it would end production in Australia by 2017.

Toyota’s decision will cost 2500 jobs among the 4000 employed by Toyota in Australia, and hundreds more among parts makers and other suppliers.

The Prime Minister says government grants wouldn’t have saved the sector and it’s time to move on to alternatives; Labor’s Senator Kim Carr says it’s going to send the nation into a 1030’s-style depression while South Australia’s Premier Jay Weatherill asked for more money to develop new jobs.

PM Tony Abbott today described the loss of the car maker as devastating, but said there would be “better days ahead” for auto workers.

He said he had on Monday night spoken to Toyota management, who told him they had looked “long and hard” at the closure and the decision was very considered, and final.

“It’s not as if the government could have leapt in at the eleventh hour and said here’s another hundred million or two hundred million dollars, please, please stay,” Abbott told ABC Radio on Tuesday.

“We’ve tried that with the motor industry.

“It hasn’t worked, and the best thing now is to focus on things that we can do and which are profitable.”

The opposition says the Victorian economy may take 20 years to recover from the closure of the Toyota plant at Altona, with industry spokesman Senator Kim Carr comparing it to the economic woes of the 1930s.

“There’s likely to be, for many blue collar Australians, an economic crisis the like of which we haven’t seen since the Great Depression,” Carr told ABC radio on Tuesday.

“There are going to be families that won’t be able to get work. There will be whole communities that will be savaged by this decision.”

Abbott admitted he couldn’t offer Toyota workers “false hope” and the transition into new jobs is not always easy.

But he said other cities and regions that had gone through significant economic changes, such as Newcastle in NSW, which lost its steel works in the 1990s, have emerged as better places.

He said the government was working to make the economy as strong as possible to ensure Toyota workers could move to better jobs in the months and years ahead.

But when asked what those new jobs would be, the prime minister said: “I can’t give you that answer.

“None of us know the answers to those questions.

“What we’ve got to do is remember that we are creative people in a capable country who have always faced the future with confidence and have always made the most of it.”

Victorian Premier Denis Napthine will fly to Canberra on Tuesday to seek support for workers left jobless by Toyota’s decision.

Abbott said he would discuss with Napthine how to create jobs through infrastructure and other projects the commonwealth is not yet involved in but could fund in the medium term.

“So the people of Victoria are confident that … their state is going to be in better shape in five years time than it is now,” the prime minister said.

In South Australia, Premier Jay Weatherill called on Prime Minister Tony Abbott to reconsider South Australia’s Jobs Plan in the light of Toyota’s decision to join Holden in leaving Australia.

“Now that Toyota is going, it is even more important that there is a government prepared to take the lead, to instil the energy and activity that creates opportunities for business and creates jobs,” Mr Weatherill said.

“If Mr Abbott thinks that $60 million shared with Victoria is enough to support workers and maintain economic activity, he is sorely mistaken.

“Now is not the time to cut and run – governments have to take the lead.”

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