Ford Motor Company President and CEO Alan Mulally and key local execs met with Prime Minister Kevin Rudd yesterday to plead the company's case ahead of the government's decisions regarding imported car tariffs and other auto and trade-related changes.

The worldwide Ford boss is in Australia on the back of the announcement of job cuts at Ford's Geelong and Broadmeadows plants and the concurrent shock resignation of local Ford Australia chief, Bill Osborne (more here). Osborne will pursue opportunities outside the automotive sector.

The Federal Government meantime is currently considering its automotive manufacturing strategy following the tabling of former Victorian Premier Steve Bracks' review into the sector last week (more here).

Mulally -- who also spent time driving Ford Australia's latest Falcon models today -- called for a "pause" in Australia's imported car tariff reductions, but said the Federal Government needed to consider a wider range of issues in deciding its strategy for the Australian automotive manufacturing industry.

The former Boeing head has accompanied Ford Asia, Pacific and Africa chief, John Parker and local boss, Osborne. They opined Ford's concerns ranged wider than tariffs, but conceded the tariff freeze was top of mind.

"I think it's [the tariff freeze] very important, and not just the tariff itself -- every element of competitiveness for the Australian industry is so important right now," Mulally said.

"Over the years Australia has continued to reduce the tariffs and so we got in the place now where we're talking about 10 per cent going to five per cent... Our suggestion is, at this critical time when we are retooling the industry and bringing out all these new fuel-efficient vehicles, that this is a time that maybe a pause in that tariff reduction would be very appropriate to allow the automobile industry to complete this retooling and get through this slow down in the [global] economy."

Mulally disputed the suggestion the viability of Ford's local operation hinged on tariff status quo, but conceded any reduction in tariff would not be welcome.

"It's going to make it harder and this is a time when you want to do everything you can to accelerate the development of the industry and our 'new Ford'. And so one thing is not going to be make or break, but you want every element you can to contribute.

"The thing about the pause is the near term. Because clearly going through this cycle on the economy as well as bringing in smaller vehicles, it's just an important time right now to take this pause... Longer term, we can continue to improve the competitiveness of ourselves and of the industry, and right now I think it's a critical piece," Mulally opined.

The Ford boss was nonetheless upbeat about the reception from the Australian PM and Minister for Innovation, Industry, Science and Research, Kim Carr.

"It's very gratifying the position that the Australian Government [holds]; about the importance of manufacturing in Australia... There are only 15 countries in the world that have the intellectual and manufacturing capability to create, design manufacture, support, export automobiles and Australia is one of those countries. And so, I'm personally pretty gratified that the leadership of Australia believes in manufacture and believes in a partnership to help create a viable, exciting long-term automotive industry.

"And so each of these elements, whether they're investors, green fund for technology, the tariffs themselves, the credits, all of that, is to me, are elements of creating a viable automobile industry," Mulally said.

Asia Pacific and Africa chief, Parker said proper bi-lateral free trade agreements (FTAs) are of equal importance to cementing future export-related production Down Under.

"I think we tried to stress to the government that they've got to work hard on bilateral FTAs. As we produce Focus here -- which we think is in the heartland of the size of product that's appropriate for Australia -- and we need a strong export program; we need to be able to export these to Asia Pacific.

"We recognise our competitors have made very good ground in the Gulf area, but in all honesty Australia's connection is to Asia Pacific and those FTAs aren't working in a balanced manner at this point in time. So we're encouraging them [the government] to expand the FTAs and to do them in such a way that there is equal treatment of products as they flow to Asia and Australia.

According to Ford Australia's outgoing chief Osborne 'non-tariff' barriers must also be dealt with.

"One of the things we stressed in our discussions with the Prime Minister was the importance of managing non-tariff barriers... Even though these free trade agreements do exist, there are many non-tariff barriers that in effect prevent the free flow of automobiles both ways."

Commenting in detail on the meeting, Osborne said the discussion with the government had been "very open" though he conceded no commitments had been made.

"I think the Prime Minister was very open -- he was very flexible. He made no commitments but he certainly didn't rule out anything that we talked about, so I'm very hopeful. Minister Carr has also been very supportive as well," Osborne said.

Osborne would not comment on whether Ford would be prepared to trade off a tariff decrease for more equitable FTA arrangements.

"I'm not prepared to discuss something like that, and that's really more appropriate for the next [Ford Australia] president to talk about.

"What I would say is, every element of competitiveness is very important right now in the industry. The industry is struggling; it is an industry-wide phenomenon. I think the Prime Minister was very emphatic that he wanted a manufacturing industry in Australia, and from that point of view I think every element of competitiveness is extremely important."

To comment on this article click here