Vic govt wants 10% auto tariffs to 2015

Keep automotive tariffs at 10 per cent until at least 2015, Victorian Premier John Brumby has urged the federal government.

In a submission to the federal government's automotive industry review, the Victorian government says the tariff must remain at 10 per cent and warns that a focus on bilateral free trade agreements creates a risk for the industry.

Victoria's car industry sector is Australia's biggest with more than 37,000 jobs and generating around $3 billion a year in exports.

"Maintaining the existing tariffs at 10 per cent is vital to securing local jobs and ensuring future investment in manufacturing in Australia," Mr Brumby said.

"We have taken a commonsense position based on changes in the economic climate and a desire not to put our local industry at a competitive disadvantage in global markets."

Mr Brumby said the domestic automotive market was too small to support a competitive industry on its own and future growth depended on being able to access global supply chains.

Key findings in the Victorian submission include that the car industry is strategically important to Australia with strong links to other industries such as tooling, chemicals and plastic, and that the global and domestic environment for the industry is far more challenging than it was when last reviewed in 2002.

"The strong partnership between industry and government in industry skills and training must be maintained to promote a highly skilled and adaptable workforce," Mr Brumby said.

Victorian Industry and Trade Minister Theo Theophanous said the decision by General Motors to export locally-made Commodores rebadged as Pontiacs in the United States showed the local automotive industry had world class capabilities.

"This submission is the latest demonstration of the Brumby Labor government's strong commitment to working with the industry to help it achieve and maintain global competitiveness," he said.