The Hon Simon Crean MP
Minister for Trade
Australia and China: Opportunities in the Automotive Sector, 20 May 2010

Acknowledgements
Vice-Governor, Anhui Province, Madam Hua
Victorian Minister for Trade and Industry, Ms Jacinta Allan
Australian Ambassador, Dr Geoff Raby.
Austrade Chief Executive Officer, Mr Peter Grey
Australian Commissioner-General to Expo, Ms Lyndall Sachs

Distinguished guests, ladies and gentlemen.
It's great to be back in Shanghai.

One of the exciting things about the trade and investment relationship between Australia and China is the shared dynamism and the potential for expanded cooperation between our respective automotive sectors.

China is now the world's largest automotive market. Following sales of almost 14 million vehicles last year, China's auto production is now expected to exceed 16 million units in 2010.
Australia too has a long and proud history of car production. Along with China, Australia remains one of the very few countries that can take a car from design right through to the showroom floor.

This reflects the strength of an industry which is underpinned by an efficient components sector and a highly skilled workforce. There is much we can do together in this sector.

Australia and China already enjoy a substantial two-way trade in motor vehicles and parts. Australian drivers are already getting to know the Great Wall 4WD, and I understand that Chery is also soon to be driving our way.

At the same time, drivers in China will have seen the Buick Royaum which we in Australia call the Statesman. And Holden engines power several models in the Shanghai GM range of vehicles.

We are also investing in each others' automobile industries, sharing technological know-how and developing cleaner energy solutions to protect the environment.

Geely's investment in the Australian transmission company, Drivetrain Systems International, and the Futuris investments in vehicle seat production in China are great examples of cross-investment that has benefited both of our automotive sectors.

I recall how impressed I was by the potential of such cooperation when I was in Wuhu with Industry and Innovation Minister Kim Carr in July last year.

We were delighted to be in Anhui Province when the Futuris Automotive Group celebrated the production of its 100,000th set of car seats.

And earlier this week I learnt that this company's supply of interiors to the Chinese auto sector now exceeds the total volume of its supply to auto makers in Australia.

This is my 7th visit to China as Trade Minister in the Rudd Government. I keep coming back because not only is China a valued friend, it is a market of tremendous promise and opportunity.

Alongside trade policy efforts in Beijing, our second track commercial strategy has a dual regional and sectoral focus which includes cities such as Wuhan and Changsha, and the provinces of Yunnan, Hubei and Anhui.

In those regions, we are creating a network of framework agreements which reflect active engagement at the political and officials level. And they lay the foundation to support partnerships at the commercial level.

Earlier this week, I discussed automotive cooperation with Chairman Zhang Ping of China's National Development and Reform Commission.

And just this evening, I have witnessed the signing of a new framework for cooperation with Anhui Province – an important step forward in building stronger ties in the auto sector.

Of equal importance are commitments like the Australian Government's Green Car Innovation Fund and the Automotive Market Access Program.

We would welcome Chinese investment in Australia to take advantage of the Green Car Fund, and our Automotive Market Access Program has a particularly strong focus on developing commercial opportunities in the China market.

Ladies and gentlemen, Australia's trade and investment relationship with China runs broad and deep. And I am confident that closer partnerships in the automotive sector will continue to emerge as an ever more important feature of that relationship.

Thank you
ENDS