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Holden quits: Decision was all Detroit’s

Early exit: Holden managing director Mike Devereux speaks at today’s media conference announcing that the iconic brand will quit local manufacturing in 2017.

Government not responsible for Holden’s Australian exit, says Devereux

Holden logo11 Dec 2013

HOLDEN’S announcement that it will close its local manufacturing operations from 2017 was a corporate decision made by General Motors and was not influenced by the federal government’s plan to cut support to the industry, according to the local chief.

Confirming the closure at Holden’s Elizabeth plant earlier today, Holden chairman and managing director Mike Devereux played down speculation that the decision was forced by the government’s lack of commitment to the industry.

“This is a decision that General Motors has taken in terms of thinking of its business globally, thinking about the relativity of our ability to have viable business cases, not just in Australia,” he said.

“But you would have noticed we had other restructuring announcements last week, even earlier this year, and it’s about making sure we have viable sustainable business cases over the long-term.

“And yesterday afternoon, that decision was made by GM’s senior leadership team that our business case in this country for the two vehicles we were planning to make is no longer viable.” In opposition, the Coalition made a pre-election promise to cut federal government funding to the Australian auto industry by $500 million and start a Productivity Commission review of the industry and how it is funded.

Mr Devereux said the General Motors leadership group in the US made the call yesterday afternoon to shut Holden’s doors, just hours after he addressed the Productivity Commission inquiry to advise of GM’s future production plans.

“This is a General Motors decision,” he said. “We have all the information we feel that we need to make the conclusion that in relativity to the other economies that we can build cars, and I don’t think this would be any surprise to anybody, that it is more viable to do that in other places than Australia.”

Holden will become a full importer from 2017, just a year after traditional rival Ford ends its manufacturing operations in Australia.

Calling the closure irreversible, Mr Devereux said a number of factors led to the US car-making giant’s decision.

“We are really facing a complex and perfect storm of conditions,” he said.

“This is not about anything other than the current realities of our business and the fact that it would seem to global leadership at General Motors, and I concur with this whole-heartedly, that it doesn’t make long-term business sense for us to build vehicles here in Australia.”

When asked whether more subsidies would have changed the decision, Mr Devereux reiterated that it was a decision made from GM headquarters, and he praised both the Labor opposition and Coalition government for their support.

“We had meetings here on October 2 with the plant tour with minister Macfarlane who has been very staunch supporter of the industry, both in the first instance that he was the industry minister,” he said. “I have had a number of very productive conversations with Ian.

“We have obviously had detailed conversations with the previous government and with the current Abbott government and our business case was transparent in that regard.

“General Motors has nothing but gratitude and praise for the very strong partnership that we have had with successive governments over the decades.” Mr Devereux acknowledged the impact GM’s decision would have on Australia, especially given Holden’s 65-year presence as a manufacturer in this country.

“I have to tell you, there is no question this is a difficult day, not just for Holden, but for the country. I understand that.

“We don’t mean to make light of the fact that, since 1948, post-war Australia, that since the very first 48-215 that rolled off the line with then prime minister Ben Chifley, that we have been a part of the industrialisation of this country and have always had a strong relationship with the government of Australia and the people of Australia and in their hearts.

“And General Motors, I believe it in my heart as does our CEO Dan Akerson, we understand the point of view of the government of this country. GM can make its decisions on its business and that’s what we have done.”

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