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Australian motor industry going down the tube.

Updated on July 12, 2011

Australia's motor industry is losing business by the bucket load.

Friday I closed my automotive workshop equipment business, the last of it's type in Australia.

It is over. I have pulled the door shut on a business that has been going for thirty years. The workshops that I supplied hoists and other heavy equipment to can't afford to buy my quality equipment and sales just stopped overnight.

The street I am in has so many empty factories it looks like no one is left.

Normal business has always meant one workshop closes, another one opens.

Not anymore. Before I decided to pull the plug I was seeing workshops close at a rate never seen before in Australia.

It ended as soon as the credit started to dry up.

Australian Workshops were on one of the lowest net margins in the country at around 2-3% so they started buying cheap imported rubbish. Big American and European brand names that have been in the market for eighty years or more started putting there name on absolutely dangerous cheap junk and flogging it off under their once highly regarded names.

Quality forgotten overnight.

Even the smart buyers who have always purchased quality tools and equipment just stopped buying and some are trying to hang on by cost cutting everywhere.

Our motor industry is in deep trouble at every level with no hope of survival without being bailed out. Sounds familiar?

Like England, Germany, America and all the other once sound economies we are deep in debt and it is not going to get any better soon.

Chinese Machinery flooded the Australian market.

China has filled the market in Australia with third rate hoists that I am not even game enough to stand under let alone work under, tyre changers that break arms, blow hoses off, don't have spare parts available, wheel balancers with shafts that are too soft or too hard a bit like Goldilocks and the three little bears story.

The metallurgy can only be described as a disgrace, and many workshops just do not get it. I don't blame them too much, they cannot afford to buy what they need and like most of us in that position kid themselves that this cheap junk will do the job.

It won't and doesn't. I am sick and tired of trying to sell quality refurbished used machines for more than they pay for new junk ones.

A typical good quality Australian made hoist.
A typical good quality Australian made hoist.

When will China wake up?

About a year ago, having seen that the Chinese products had come a long way with design I decided to research the best Hoist manufacturers in PRC starting with the big manufacturers. My intention was to offer to give them my design for a better hoist incorporating the best features and safety locking systems. I was prepared to do so at my own cost.

In the design I was able to incorporate a new system that would make the hoist fail safe using electronics with mechanical over-ride.

For the next year I tried to negotiate with the 3 companies I had chosen while testing the current hoist offerings from their companies. this was greatly assisted by our experience in servicing and maintaining hoists along with installing/removing them.

I could not get them to understand that the goal was not the price, no matter what I said.

I explained that the metal used in the large pillars that support the hoist needed to be processed to a better standard to make it as strong as the best of the American, Australian, Japanese and European hoists. I got blank looks.Nor could they comprehend that the hydraulics including seals, pistons, hoses etc needed to be suitably upgraded for reasons of safety and longevity.

They seemed amazed that I thought such a hoist would sell, because it would be not much cheaper than an American made hoist.

There does not seem to be any confidence from management that they could sell a hoist based on anything but price.

Screw the safety and longevity it must be first of all cheaper. A lot cheaper.

In a past life I  had consulted to a company here in Melbourne wholly owned by the Chinese Government and experienced the same thinking.

  • They imported an electronic phone based on price only. They did not comply and were useless in Australia. They continued to bring in non-compliant electronics and ignored the need for compliance and my advice (which they were paying me for.) With compliance for their imports they would have sold like mad, but no, it was cheaper! Lunacy!

Then they wanted a really up to date data-base of potential customers.

I offered them the best available at the time by Dunne and Bradstreet for the bargain price of $11,000.00.

They were horrified despite the obvious quality and the successful track record of the other companies using the product offered.

  • They went and paid $500 for the database they purchased which was not worth $5.00 and was totally out of date and useless.

A good friend of mine who still brings in 60 million worth of electrical/electronics a year from China suffers the same way, yet he has been doing it for twenty years. TVs computers, hardware, DVD players etc. No service or backup worthy of mention.

He is the front end of marketing for Australian based Chinese importers and travels to China several times a year trying to fix ridiculous problems like the ones I have experienced.

We both understand the culture and have had Chinese partners, we both understand the "Organic" contract culture and even why they prefer them. (Other countries like America and Australia making contracts where they do not carry risk)

So please, someone educate me. What works? I have seen electronics product come out of China even 12 years ago that were superbly made our of the best components in a super modern American owned factory, so I know they can do it. A fine example would be the Quorum range of house alarms. The motherboards did not drip any voltage. Batteries lasted almost forever!

The plastic casings were almost indestructible and design was cutting edge. No bulky cheap boards, all top class electronic components etc.

I still do not understand why China has gone the same way as Japan then Korea back in the sixties then seventies, you would think they would learn from experience. I am old enough to remember when the metal was so bad from Japan that engineering products were unusable.

Then Korea did the same! The first after-market motorcycle brake levers would not even fit and were so soft you could bend them by hand!

Both countries can now produce quality products, the Japanese being in most cases the industry standard and superbly built and assembled, the Korean products still a bit iffy, especially their cars.

The Koreans use a lot of Mitsubishi (or Bits-are-missing as the wags of our industry call them) as a base for engine and drive train.

They remained generally a bit softer than the rest of the Japanese products for some time, with a history of soft motors and lousy weak gearboxes, especially the early Magna sold here.

I digress. I guess apart from losing a lot of money by having a fire sale to step out quickly without having to pay more rent, buy more stock and be locked in to another year of fruitless work. I am thoroughly fed up with trying to persuade people to buy decent machinery when they don't understand or just can't afford it.

I buy Chinese products too, it is just that you cannot use Chinese workshop machinery as in this application it is still dangerous crap, but taking any sort of moral stance does not make money in the "new" automotive workshop economy.

No Junk equipment for me.

I have always refused to sell it. Every year or two I had a look to see if it was getting any better.

It has, but only marginally and as using workshop equipment is already dangerous enough, I refused to add to the carnage.

A cheap TV is not likely to kill you. A cheap hoist is.

A hoist not only has to pick up heavy vehicles. It has to hold them up while your mechanic son/father/brother/sister go underneath to remove and replace major components. This mat involve removing something heavy from one end or the other increasing the stress on the hoist your family member or you are still underneath. If the car falls you can add the weight of at least some parts of the hoist to ensure serious industry or death.

Our Government conveniently put the onus on the user, and if a hoist is to be banned from sale it seems a few more people will have to die or be seriously injured by the same hoist every Wednesday between 3 and 4 am.

What I mean to say is they will do nothing without proof, know next to nothing about hoists and the only way they will ban a hoist is with continuous failure. I have offered to provide engineering proof of impending failure, design faults etc. Not what they want.

Death or injury as proof.

They want blood on the floor. Screw them. These are the same people who insisted I replace my forklift seat because of cracks in the cover.Ever had to replace a seat on Ia twenty year old forklift? i told him sarcastically that I do not use it for daily commuting as it does about 4mph, and never leaves the workshop as it is just used like a crane and never saw the road outside and never needed to, but they put it on their list.

trust the system? Sure you can't.

I guess I will have to earn a living writing, and those of you who read my hubs know I have a very steep learning curve before I make any money from that!

Anyway, I still have my friends and family and I am very grateful for their support.

I am not alone in closing down.

I am a long way from being alone in closing down. Already the shopping strips have vacant shops everywhere, the guy who will take over my lease will get it for 2/3rds what I was paying, and all around me there are vacant houses and factories piling up already and we are not even in a recession yet according to our Government.

Why is it that Government seems to be the last to see these things?

If I can still afford our lousy slow and over-priced broadband at least I will be able to write online and let off a bit of steam. I guess the order will be to learn how to write, then learn how to monetize my writing.

Maybe I will find a rich partner who likes old guys who are a bit past it generally.

Or maybe one of my kids will get rich and keep me in the manner I have become too comfortable with.

Old but great European quality

An old Beissbarth wheel balancer. Worth more than 2 new chinese ones.
An old Beissbarth wheel balancer. Worth more than 2 new chinese ones.

Used workshop equipment

A few of the used machines I had in stock.
A few of the used machines I had in stock.

American Ammco brake lathe. World's best in my view.

A decent brake lathe like this will last forty years and still do a perfect job.
A decent brake lathe like this will last forty years and still do a perfect job.

Rebuilding an Ammco 4000 brake lathe

Rebuilding a brake lathe the same as the one above.This one is forty years old and needed very little repair. Quality superb!
Rebuilding a brake lathe the same as the one above.This one is forty years old and needed very little repair. Quality superb!


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    • earnestshub profile imageAUTHOR


      9 years ago from Melbourne Australia

      Thanks Mark. Cheap automotive workshop machinery is a total waste of money, yet the consumer keeps on buying this crap. Quality is essential with this type of equipment. I will learn to write given enough time. I guess I will stick with it.

    • Mark Knowles profile image

      Mark Knowles 

      9 years ago

      Hey Earnest - sorry to hear you have shut your business. I have closed a couple myself - for much the same reasons. Cheap, low quality competition. I blame the consumer myself. If they genuinely wanted high quality they would pay for it.

      Good luck with the online writing. I know it aint that easy, but it is doable.

    • earnestshub profile imageAUTHOR


      9 years ago from Melbourne Australia

      Hi agvulpes, Yes they were. I use the past tense because I believe some outsourcing has crept in to the components since.

      With all the cheap hoists on the market price is still the driving force for buyers.

    • agvulpes profile image


      9 years ago from Australia

      Earn I believe the hoist you are showing is a Molnar and made in Australia. Is it a good hoist?

    • earnestshub profile imageAUTHOR


      9 years ago from Melbourne Australia

      agvulpes, the bad name is well deserved. In entering the heavy machinery market they have endangered lives world-wide and apparently do not give a toss about safety.

    • agvulpes profile image


      9 years ago from Australia

      Hi all I guess what we really have to do is be a bit wise!!!!!

      Being cheap does does not by necessity mean "crap"?

      There is a lot of "cheap" stuff out there that is of a reasonable enough quality for a handiman level use.

      Eric I'm pretty sure you and Earn and myself would know not to try and drill those sort of holes in metal with a cheap drill, at least not without a pilot hole. Jeez talk about give the chinese a bad name?

    • Eric Graudins profile image

      Eric Graudins 

      9 years ago from Australia

      I;m sure we'd have lots to talk about Earnest.

      Sorry you had to sell your tools. Must have been hard.

      I've got spanners like that, and have still got an AEG drill that I bought over 30 years ago too. Hasn't missed a beat.

      MY father in law got one of those $18 specials. Used it for 5 mins drilling 1/4 holes in RHS tubing, and the plastic brush holders melted. Sheesh!

      My son is car mad too, has made an episode of "top Gear Tassie" in his room. It's a scream.

      Ag, I've got one of those cordless drills too. And bought another one recently, because the drill and 2 batteries cost less than one replacement bettery.

      The worlds gone mad. We're so freakin' doomed ! :-)

    • earnestshub profile imageAUTHOR


      9 years ago from Melbourne Australia

      Eric. thanks for the comments. I have yet to get passed having sold all my tools last week when I closed my business. You certainly are right about the feel of good tools.

      My friend John when discussing tools went and got an old spanner from his apprentice days out of the car and passed it around amongst a whole bunch of blokes who love quality tools. We talked about the weight balance and feel of it before he lovingly wrapped it up and carefully put it away. It was a buzz for all of us! Scary hu?

    • earnestshub profile imageAUTHOR


      9 years ago from Melbourne Australia

      Quality hand tools do cost a lot agvulpes, and the $59.00 price you paid was pretty good value so far as the life of the drill is concerned. I bet you know how to use it properly though.

      I have a 26 year old keyed chuck AEG that was a bit pricy but it is still great after seeing life as a lathe, Masonry drill also used on framework. Unrepaired till now except for regular cleaning of comutator and new brushes. 2 speed to boot.

      Some of the drills for sale today go as low as AU$18.oo

      They are great to throw in the boot of the car or in the house or shed to use for the odd small job. On this sort of work they are pretty good, and this is a valid niche market for Chinese and other imports.

      I bet you would choose the DeWatt if you used it all day though.

    • agvulpes profile image


      9 years ago from Australia

      Eric I hear what you are saying about the quality tools. The thing is I have had a $59.00 18v cordless drill ( also keyless) (2year replacement warranty) for 7 years and it has never let me down.

      Admittedly I use it only in a home environ, but it has done some pretty hard work.

      Even if it had died in 5 years I would have just gone and bought another one and got another 5 years life with a 2 year replacement warranty.

      There is no way I could have afforded or justified spending about $300 on a DeWalt or similar drill.

    • Eric Graudins profile image

      Eric Graudins 

      9 years ago from Australia

      Yes, the demise of quality tools is sad.

      I suppose I have a fetish for good quality tools, having been a fitter, machinist,toolmaker, etc. in a previous life.

      I've had people comment on how "good" some of my tools are to use.

      But someone who only uses a ratchet once in a blue moon can't justify spending $100 on a ratchet handle, when a $5 one "does the job". Same with everything else.

      Hey AG, The success of GMC is based on importing squillions of attractively packaged power tools and accessories.

      The faults and crappy construction and assembly are overshadowed by the very cheap price.

      So this failure may mean that Aussies want quality tools, and not junk. Maybe not a bad thing.

    • agvulpes profile image


      9 years ago from Australia

      Hi again Earnest, I noticed over the weekend that another "success story" Australian company has gone into Receivership. The company being "GMC" for people that do not know "Global Machinery Company" who in the past has sponsered many events on the Australian Sporting calander.

    • agvulpes profile image


      9 years ago from Australia

      Earnest, I'ts sad to hear about your business closing down, but on the positive side you will be able to devote more time to your writing. Hopefully we will see more Hubs from you in the future?


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