Could the highly successful SEMA Garage product development concept work in Australia? Is this the answer to ensuring the future of the Australian automotive manufacturing industry?
The Australian Automotive Aftermarket Association (AAAA), together with a consortium of auto component manufacturers and the Queensland Government, have commissioned a feasibility study to find out.
The SEMA Garage is a highly successful industry funded facility based in California, USA. It gives automotive aftermarket product manufacturers access to newly released, and yet to be released, vehicle models.
An Australian Automotive Innovation Lab would give the aftermarket sector a chance to ensure that new products can be successfully integrated with the latest and emerging vehicle technologies and comply with vehicle and product standards.
With access to vehicles that are not yet on Australian roads, new aftermarket accessories and performance modifications could be designed for each new vehicle making sure that as soon as a new model lands in Australia – the aftermarket is ready to supply consumers with quality products.
The aftermarket – the growth sector
The aftermarket is the sector of manufacturing industry that is predicted to grow after Australia’s car makers close their plants.
Many of Australia’s globally recognised producers of vehicle frontal protection, suspension components, roof racks, tow bars, side steps, performance parts and other aftermarket products currently send their engineers overseas to access new models so they can design new products.
An Innovation Lab would put high selling overseas models in our backyard where Australian companies could study them and develop new products. This would also expand the range of vehicles for which Australian companies could make products.
If proven viable, the Innovation Lab will offer automotive aftermarket businesses access to high technology tools and equipment required to take products from concept through to market. It would greatly reduce costs and product development lead time.
An Innovation Lab will support the design of new safety and performance solutions for car owners in Australia and expand opportunities in the sector’s export markets.
What would the Innovation Lab do?
The Innovation Lab would not be a standard research facility – it would be a real world product design hub. To increase local sales and export market opportunities, Australian automotive manufacturers must have access to new vehicles and the latest test equipment to ensure products meet regulatory and design compliance for vehicles manufactured overseas.
AAAA Executive Director Stuart Charity said soon all cars sold in Australia will be imported. “There are good reasons why we will need to modify global platform vehicles for Australian conditions,” he said.
“On the mix of urban and rural roads in Australia, vehicles require special purpose modifications to make them fit for purpose in terms of safety and performance. This is especially true for vehicles carrying heavy loads and/or towing.
“We also have world class companies manufacturing components for vehicle modification for defence, mining, rescue and emergency services. Businesses such as these would benefit from the Innovation Lab,” said Stuart Charity.
Investing in an automotive future
The AAAA predicts the aftermarket and specialty vehicles are the future of automotive manufacturing in Australia. “Fortunately in Australia, these are the auto manufacturers that are growing. The reward in the aftermarket is higher margins than the traditional Australian original equipment supply chain that has been servicing Ford, Holden and Toyota, said Stuart Charity.
“Aftermarket manufacturers are traditionally in the front line of automotive innovation and achieve over $1 billion per annum in export sales. Investing in new equipment, research and development will expand markets and grow employment levels.
“If the feasibility study proves the business case and an Innovation Lab is established, our manufacturers will have greater opportunity to design, develop, manufacture and distribute high quality products that meet both local and international regulations and specifications.
“The Australian Innovation Lab would be modelled on the Specialty Equipment Market Association (SEMA) Garage. This Los Angeles, California based facility offers the USA automotive aftermarket companies access to expertise and equipment on a fee for service basis.
“The SEMA Garage has industry ownership and accountability, and has already been very supportive of AAAA in the establishment of an Australian Auto Innovation Lab,” said Stuart Charity.
Australian Automotive Innovation Lab Champions Club.
AAAA has engaged Grant Thornton Australia, a business consultancy with extensive automotive industry experience to deliver the feasibility study. The study is funded one third by a Queensland Government grant, one third by the AAAA and one third by the Australian Automotive Innovation Lab Champions Club.
The Champions Club is a group of auto companies that became foundation members by financially backing the Innovation Lab Feasibility Study.
Stuart Charity said AAAA is delighted that the Queensland Government is a supporter of the Australian Automotive Innovation Lab concept. “We think that a funding model of one third government, one third industry association, and one third from individual company participants is ideal for the feasibility stage,” he said.
“The vision that everyone has demonstrated has made this an incredibly exciting project. We spoke to South Australia and Victorian state governments in 2015 and the Queensland government about three months ago.
“Queensland has over 600 companies engaged in parts manufacturing with 7,500 auto employees. They were very quick to see the Innovation Lab’s potential – it took less than four weeks for the Queensland Government to commit to providing a third of the funding.
“Before seeking government support, we flagged the prospect of industry support with our members and most Champions Club spots were taken in about two weeks. We have never received so much grass roots support for an idea before – this level of support and commitment is unprecedented,” said Stuart Charity.
The AAAA would like to acknowledge and thank the following Australian Automotive Innovation Lab Champions for their support of this exciting project:
Companies interested in joining the Innovation Lab Champions Club, or wanting further information about the Australian Automotive Innovation Lab, are invited to contact AAAA Policy Officer Michael Ford at T: 03 9545 3333 or E: firstname.lastname@example.org.
Visit the SEMA Garage at www.semagarage.com