The current "command line" instructions mention installing "real" avr-gcc. If you've already installed arduino to get the libraries and source modules needed, you already have a copy of avr-gcc that's certainly complete enough to compile arduino sketches, and the makefile can make that invisible to the users. I have (in the makefile from the wiki):
# Program settings
CC = /Downloads/arduino-0008/tools/avr/bin/avr-gcc
CXX = /Downloads/arduino-0008/tools/avr/bin/avr-g++
OBJCOPY = /Downloads/arduino-0008/tools/avr/bin/avr-objcopy
OBJDUMP = /Downloads/arduino-0008/tools/avr/bin/avr-objdump
SIZE = /Downloads/arduino-0008/tools/avr/bin/avr-size
NM = /Downloads/arduino-0008/tools/avr/bin/avr-nm
AVRDUDE = /Downloads/arduino-0008/tools/avr/bin/avrdude