The federal budget will include $100 million of funding for a manufacturing sector facing the demise of Australian car making.
The Turnbull government will tip $100 million into the advanced manufacturing sector to create jobs, grow businesses and improve productivity and competitiveness.
Ahead of Tuesday's budget, Industry Minister Arthur Sinodinos detailed the new money, of which $47.5 million is on top of an existing $155 million Advanced Manufacturing Growth Fund to cushion the demise of car making.
"These initiatives, together with the tax cuts for around 3.2 million Australian businesses, will help our manufacturing businesses," Senator Sinodinos said in a statement on Monday.
The minister told FiveAA radio in Adelaide the money was aimed at the South Australia and Victoria manufacturing bases, ahead of car giant Holden shutting down in Australia.
It will be used to establish innovation labs in the two states for smaller-scale research projects.
The minister believes this support, alongside the industry efforts, means companies that would otherwise close will not.
HOW THE $100 MILLION WILL BE USED:
* $47.5 million over two years on top of the existing $155 million Advanced Manufacturing Growth Fund.
* $20 million over two years for larger scale advanced manufacturing research projects under the Cooperative Research Centre.
* $13.5 million tariff reduction on imported vehicle prototypes and components used by Australian motor vehicle design and engineering firms.
* $10 million to establish innovation labs in South Australia and Victoria.
* $4 million over two years for the Advanced Manufacturing Growth Centre to support small scale and pilot research projects.
* $5 million for student research at universities and technology institutions.