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Holden quits: SA stakes claim to Cruze money

High stakes: South Australian premier Jay Weatherill says Holden’s public money should now go to the states most affected by its decision to stop building cars in Australia.

Jay Weatherill says Holden money should help hard-hit SA and Victoria

12 Dec 2013

SOUTH Australian premier Jay Weatherill has called on the federal government to divert money promised to Holden to the states that will hurt most from the car-maker’s withdrawal.

Speaking at Canberra airport this morning on his way to meet with prime minister Tony Abbott in what was initially meant to be a plea to save the car-maker, Mr Weatherill said he would now be making demands for support to help SA and Victoria adjust to the loss.

Victorian premier Denis Napthine is also in Canberra today to speak with Mr Abbott.

The federal government, and the SA and Victorian governments, had already offered $275 million in March last year to help Holden build two all-new vehicles, expected to be the next-generation Cruze small car and the Commodore.

In return, Holden had promised to invest $1 billion in building a new production line, as well as returning about $4 billion to the Australian economy over the lifetime of the program.

However, just over a year later the car-maker revealed it was struggling to survive with rising costs and a high Australian dollar eating into its long-term viability.

Mr Weatherill said while he noted Mr Abbott’s “expressions of concern” for SA, he would be seeking “a tangible indication of his sympathy”.

“We’ll be putting some positive proposals to him, and we’ll be seeking an immediate response to them,” he said.

Mr Weatherill said he expected the federal government to support several new large infrastructure projects in the state, which he indicated could be paid for using federal funds previously earmarked for Holden.

“All of the money that would otherwise be coming to South Australia should be quarantined and applied to both South Australia and Victoria to assist them with the adjustments that are necessary.”

Mr Napthine is expected to give a statement shortly after he arrives in Canberra later this morning.

Meanwhile, General Motors appears to have gone into crisis mode after deciding this week to shutter its car-making business in Australia.

The international car-maker has declined to answer a number of key questions put to it by GoAuto regarding Holden’s withdrawal from manufacturing, including the timing of production shutdowns for both the Cruze small car and the Commodore large car and ute range, and where future versions of the Cruze will be sourced from.

GM communications staff member Greg Martin would only confirm that the Holden name would live on beyond 2017 – the year that the brand becomes a full importer – and not switch to another badge within GM’s global portfolio.

Mr Martin deferred other inquiries to Holden’s media team, including the question of whether a successor to current Holden managing director Mike Devereux would be named – his tenure as the head of the Australian car-maker ends in February – and if the management of GM’s Australian operations would switch to Singapore ahead of the 2017 cut-off.

The Korea Times today renewed speculation that Australian production was likely to switch to the Asian car-making division of GM once Holden shut down its Cruze line at Elizabeth, north of Adelaide.

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