Nev Power, boss of the Fortescue Metals Group, which shipped almost 81 million tonnes of iron ore last year, has called on the Australian Government to abolish taxpayer support for the car industry, warning Australian will “end up looking like Greece” if it continues to capitulate to capitulate to what Mr Power calls “special interest groups”.

Mr Power, who has a background in the steel industry, told the Committee for Economic Development of Australia in Perth that special interest groups like the car industry would “tear our economy down” in their quest for subsidies and protection. He called on Prime Minister Tony Abbott to stand up to both the automotive industry and trade unions.

“If we start living in an environment where we expect entitlement, then we’ll end up looking like Greece eventually,” he said. “Why is the car industry different to any other industry?”

Mr Power told the Committee that manufacturing of passenger vehicles was only a tiny part of the Australian automotive industry, and said the current debate was semantically flawed. “When we talk about support for the ‘car industry’ we are really talking about support for a … tiny part of that sector,” he said.

Mr Power said the debate surrounding the car industry failed to acknowledge the greater part of the car industry – the dealerships, finance sector, repairs and spare parts, etc.

The Fortescue boss is engaged in a major cost-cutting drive within his company, as it ramps up production. During his address he also took a swipe at sky-high wages paid in the mining sector. “There is this expectation all around Australia, and perhaps the world, that if you come to Western Australia you can get $100,000 to drive a truck,” he said. According to Fortescue’s 2013 Annual Report, Mr Power received a total remuneration of $2.96 million from the company in 2013.

Author:

John Cadogan is Editor in chief at BCCL. For the past 20 years John has worked for top media companies; such as Channel 7's Today Tonight and 2UE Radio.