Business Climate International provides you with the following article on Climate Change, originally published on the website Business Spectator.

The future of South Australia's car manufacturing industry lies in the development of new low-carbon, fuel-efficient vehicles, Premier Mike Rann says.

Releasing the state's submission to the federal government's auto industry review, the premier also renewed a call for tariffs on imported cars to remain at 10 per cent rather than fall as scheduled to five per cent in 2010.

"Reducing the tariffs at this stage would put our car industry at a competitive disadvantage against other countries, especially those trading partners that continue to maintain comparatively high import tariffs," Mr Rann said in a statement issued from Dallas, Texas.

"The extra revenue from keeping the tariff at 10 per cent should be used to support the next cycle of investment and product development so that the industry can grow exports based on new innovative models."

Mr Rann said South Australia wanted to maintain a car industry, noting that even with the closure of the Mitsubishi assembly plant the auto sector still employed about 11,000 people in the state.

"The car industry is a big investor in research and development, and in innovation," he said.

"Even with a 10 per cent tariff, Australia would easily have one of the most open car markets anywhere in the world.

"The future is not kicking away all support from the local industry, but helping it to innovate and grow exports."

The SA submission called for the federal government's $500 million Green Car Innovation Fund to be used for researching and developing new low-carbon technology for wider application across the industry.

"Clearly, car buyers in markets across the world, including Australia, are now looking to purchase more fuel-efficient, environmentally friendly vehicles," Mr Rann said.

"While the industry has agreed to a voluntary target of reducing fleet average fuel consumption levels for passenger cars by 18 per cent by 2010, this is likely to be insufficient to meet Australia's commitments under the Kyoto Protocol.

"Similarly, many other countries, including the US, have agreed to fixed targets to reduce their fleet fuel consumption."

Mr Rann said the SA submission argued that local car manufacturers should be seeking out opportunities to contribute to the global effort of reducing fuel consumption.

"To that effect, markets outside of Australia such as the US, which is one of our biggest export markets, must be considered when developing the next generation of fuel-efficient cars," he said.

In the US, car manufacturers were now looking for innovative and lower-cost supply solutions.

"Suppliers should be encouraged to explore new opportunities in those markets that are seeking to reduce their carbon emissions," the premier said.

"The state government wants South Australia's car and component manufacturers to begin developing new low-fuel environmentally friendly cars with the help of the research and development funds now being made available to them by the Green Car Innovation Fund."

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