According to the Tasmanian Automobile Chamber of Commerce, the announcement by the Prime Minister of fuel excise reforms is an exploding Christmas present for the LPG industry.

"This excise announcement is going to blow the LPG industry out of the water. It is ill-considered folly on the part of the Federal Government," TACC General Manager, Malcolm Little, said.

"Regrettably, while disappointing in the extreme, the announced excise changes have not come as a surprise. The industry has been aware for some time that the Federal Government does not seem to know what it is doing with alternative fuels.

"It has fiddled about for political gain with half-baked proposals for ethanol subsidies to appeal to narrow sectional interests while all-but ignoring an LPG industry in crisis.

"It is astonishing that the Government can carelessly roll a hand-grenade into a local industry that is right under our noses, is efficient, has a distribution network in place, has environmental benefits over conventional fuels, is produced locally and employs many thousands nationally.

"The announced $1000 subsidy to consumers purchasing a new dual-fuel or dedicated LPG vehicle, available for three years from July 2008 is a hollow and meaningless gesture.

"There is little danger in any consumers taking up the offer. By 2008 the LPG industry will be as dead as a doornail.

"Already, Ford Australia has indicated that the excise announcement spells an end to its production of LPG-dedicated vehicles.

"At the end of the day, when the LPG industry has shut up shop, when local car makers pull the pin on LPG-dedicated vehicles, and when we're forced to import more fuel to fill the void left by LPG, the Government may find that this present for the LPG industry has blown up in its own face," Mr Little said.

For more information, contact Malcolm Little at TACC on 03 6278 1611 or 0408 398 670