Larvatus Prodeo

The Bracks Review’s final report was released last Friday. The headline recommendations – in essence, tariff cuts to continue, but direct government handouts to also continue in expanded form until 2020 – have been covered extensively elsewhere. But there’s a hell of a lot to chew on in the other 190-odd pages of the document. Much of the report does a pretty good job of undermining the economic case for continued support, in fact; there’s extensive global overcapacity in the industry, China and India are moving up the value chain, and making cars in developed countries is a very unprofitable enterprise at the moment. Furthermore, the modelling for every single free trade agreement we’ve either a) signed, or b) is in the offing, indicates that Australia’s overall economy benefits, but the car industry won’t. So, if the car industry is all important, why are we so keen on signing FTAs that undermine it? But one of the most fascinating sections discusses the impact of climate change on the automotive industry. There is an enormous gap between what the science and the global politics are saying, and how much impact on the sector this is judged likely to have.

As has been said any number of times here on LP, the government’s election promise of 60% emissions cuts by 2050 has been left behind by events; the science is calling for steeper cuts, and any global deal is going to involve Australia making disproportionate cuts because of its enormous per-capita emissions. Absent cheap, environmentally benign carbon air capture and sequestration technology, this will necessarily involve the virtual decarbonization of Australia’s transport sector, and probably over the period of a couple of decades. Thankfully, this looks like it may actually be achievable, through technologies like the plug-in hybrid, the first production example of which will be the Chevrolet Volt.
Continue reading ‘Green disconnect in the Bracks Report’