Automotive expert says Holden poised to shut down

[Jim Goose]

Hot on the tail of the 170 job losses...

Automotive expert says Holden poised for collapse
AM
By Emily Bourke, staff

A motoring expert has claimed that Holden is poised to shut down for good because it can no longer compete in the global market.

The Australian car manufacturer announced yesterday that 170 jobs would be cut from its Elizabeth plant in Adelaide.

The announcement came just seven months after a $275 million rescue package was promised by the Federal and South Australian Governments.

The editor of car buyers' Dog and Lemon Guide, Clive Matthew-Wilson, says propping up the industry with taxpayer-funded bailouts is useless.

"Let's not be fooled by this they are going to close anyway," he said.

"It is 40 per cent cheaper to build cars in Thailand than it is to build cars in Australia.

"If you look at the long-trend track record of car companies in Australia, they take billions and billions of taxpayer's dollars and they close down anyway."

One of Holden's major parts suppliers, Autodom, also stood down 400 workers in South Australia and Victoria this week.

Wayne Hanson from the Australian Workers Union says the Australian car manufacturing industry is relying on techniques of the last century and needs to be brought up to speed.

"What needs to be done is to re-tool so that we can better equip ourselves to make sure that we are the leader," he said.

"[We need to] follow the model that has been set by Germany ... they've established themselves into niche markets and are doing very well."


Federal Industry Minister Greg Combet says the decision by Holden demonstrates why the Government needs to work with the auto sector to improve the productivity and sustainability of the industry and its workers.

But John Spoehr from Adelaide University's Australian Workplace Innovation and Social Research Centre says there needs to be some strings attached.

"There should be a trigger point at which government assistance is reconsidered," he said.

"I wouldn't want to hold any manufacturer to a particular number. I think there should just be a band or target that you don't want to go below.

"But, also, you should be trying to get manufacturers to think about how they can substantially transform their facilities to be able to survive in the 21st century."
Audio: SA Government sees hope for Holden despite job cuts (AM)

South Australian Manufacturing Minister Tom Koutsantonis says public investment in Holden represents good value for money.

"The worst aspect here is if we didn't have the package there would be 2,300 jobs going missing," he said.

"This is the process of turning it around. We've always said there'd be a reduction in manufacturing jobs.

"What we're saying is to keep those jobs you need that creative destruction happening because we are transforming to an advanced manufacturing community.

"We can't compete with Thailand on cost of labour. We can't compete with Russia on wages, we can't compete with China. And if we try we will lose.

"What we've got to do is gear up for international platforms and give our components makers scale."

Brad Dunstan, from the Victorian Centre for Advanced Material Manufacturing says public assistance is justified.

"You've got to look at the automotive industry as a core industry," he said.

"The automotive industry is a unique breeding ground for high quality engineers with benefits that flow on to other industries.

"Creation of one high tech job leads to the creation of five other downstream supply jobs."

http://www.abc.net.au/news/2012-11-0...llapse/4351194

[Brazen]

Wow, the ABC is really loving predicting the end of Australian manufacturing. And resorting to quoting the editor of the Dog and Lemon guide who used to be a mechanic and now writes cookbooks??? Come on.

[mik]

A very telling short sentence in that article that sums it all up.

"It is 40 per cent cheaper to build cars in Thailand than it is to build cars in Australia.

No amount of restructuring or modernizing will ever make up for a 40% additional cost hanging around the neck of Australian manufacture, only government policy change can put our manufacturing on a level playing field with cheap imports.

[JG33]

Originally Posted by mik

A very telling short sentence in that article that sums it all up.

"It is 40 per cent cheaper to build cars in Thailand than it is to build cars in Australia.

No amount of restructuring or modernizing will ever make up for a 40% additional cost hanging around the neck of Australian manufacture, only government policy change can put our manufacturing on a level playing field with cheap imports.

Has a lot to do with lower wages as well and unfortunately you can't lower wages here when cost of living is going sky high.

[jpd80]

Originally Posted by mik

A very telling short sentence in that article that sums it all up.

"It is 40 per cent cheaper to build cars in Thailand than it is to build cars in Australia.

No amount of restructuring or modernizing will ever make up for a 40% additional cost hanging around the neck of Australian manufacture, only government policy change can put our manufacturing on a level playing field with cheap imports.

Where did he get the 40% figure from?
The build costs for an Australian cars ix around $1500 more than if it was build with Thailand labor.

[mik]

Originally Posted by jpd80

Where did he get the 40% figure from?
The build costs for an Australian cars ix around $1500 more than if it was build with Thailand labor.

there must be more to it than that , why are other big companies either closing down in Australia or shifting to asia.

[Road_Warrior]

I saw the thread title and I thought "oh FFS, what "expert" have they dug up this time?"

And it was none other than that Holden-hating hyphenated clown Clive Matthew-Wilson. Case dismissed.

[TC200six]

Whenever a company is reported to be in financial trouble, ABC typically likes to report on the matter in such a way that it seems like they're trying their best to drive them into the ground. They sounded that way not long ago when Channel 9 revealed they were facing debt, but unfortunately for them, the expert they interviewed claimed Nine shutting down would be unlikely.

[Jim Goose]

The media bashing about the aussie automotive industry is getting a bit long in the tooth... but there are some valid points occasionally.

Sadly the protections our industries (not only automotive) have all lost out because of our "free trade agreements".

No country can compete with 3rd world industries where the pay is a few cents a day.

[Vormund]

ABC will take any negative news on car manufacturing and make it worse. They basically did this to Mitsubishi, they "predicted" their doom for like 10 years before it happened. I think they even did when the TE Magna was selling really well at the time.

Don't know wtf their problem is.

Look at this one from 2000:
"Future of Adelaide Mitsubishi unknown"
http://www.abc.net.au/7.30/stories/s213246.htm

Well if it's unknown what are they exactly reporting then?

[Joe5619]

Did I miss something in that article... The title was totally "false advertising" as most of what was written was talking the car industry up, was it not?

[flappist]

The truth is always in how you spin it.

Originally Posted by Clive Matthew-Wilson Motoring and Cinema expert (maybe)

The Wizard of Oz.

A girl is forcibly relocated to a different culture where she immediately kills the first person she meets.
She then teams up with 3 strangers in order to kill again before deserting them at the scene of the murder and escaping.

[ivorya]

The only good thing about this article is it doesn't have FORD in the title.

About time we have some negativity for the other brand!!

[ThePistonHead]

He's right if you ask me. Same thing happened to bucket loads of other manufacturing sectors in Australia.

[JG34JA]

Let me get this straight,

The pair-trade for the ABC is short Aussie manufacturing industry, and long motoring/cooking experts?

[ryeman]

Originally Posted by Jim Goose

Hot on the tail of the 170 job losses...



http://www.abc.net.au/news/2012-11-0...llapse/4351194

First time here, forgive any stuff ups ......

....so Sydney forecasts the demise of SA/VIC industry again again again ... What's new?
The tragedy would be for us to abandon an increasingly important hi tech manufacturing sector with so many knock-on implications.
What we need to concentrate on is cutting-edge design with R&D and proving done here and accept that we can't compete on assembly labour costs when compared to Asia.
Ultimately we are in the hands our foreign owners....can we trust THEM?

[Windsor220]

Not sure Holden will be shutting down in the near future but on the other hand I wouldn't be taking both Ford and Holdens words about staying here until atleast 2016/8 as fact. Things can go south very quickly.

[jpd80]

Geez, it must be a slow news day, I swear these same journalists cut and paste Ford death stories onto a Holden title.

This is the same local production hate stories but with a Holden twist and i for one will be sticking up for Holden in this instance.

VE Commodore is effectively six years old and has every right to be selling in fairly low numbers, you can only refresh so many times.

[Burnout]

What a load of old cobblers........

[FGII-XR6]

this sort of thing is what I could see when Paul Keating was carring on about the level playing field. he didn't level it he tipped it the other way.
it was obvious Australian manufacturing was going to suffer when we eliminated tarrifs. I'm not saying the system was right but the complete abandonment of tarrifs crippled Australian manufacturing

[jpd80]

That and the fact that money from tariffs stopped flowing to car makers and went into consolidated revenue,
the government wrongly believing that 10% price hike would slow the onslaught of foreign cars but gave
precious little funding to local car makers to help them remain technologically competitive with Asia.
Apparently the lure of billions in commerce conducted here in Australia was not enough to sway the government...

[KW XRT]

**** ed off Gillard hands over 176 million and what do they do with tit spend millions of our taxpayer dollars on tripple 888.Lets not forget the already millions spent on HRT surely that money could be better spent.

[BENT_8]

When the auto manufacturing industry in this country collapses, and it will, i hope all the people with imports in their driveway are proud of themselves.

Dont blame the government for killing the industry, blame the people who buy vehicles built offshore!

If everyone who was in the market for a new car in the next 3 months were to buy a Falcon, Commodore, Territory, Camry or Cruze, the headlines would be completely different.

[KW XRT]

Originally Posted by BENT_8

When the auto manufacturing industry in this country collapses, and it will, i hope all the people with imports in their driveway are proud of themselves.

Dont blame the government for killing the industry, blame the people who buy vehicles built offshore!

If everyone who was in the market for a new car in the next 3 months were to buy a Falcon, Commodore, Territory, Camry or Cruze, the headlines would be completely different.

You got that right I had an import about 7 years ago and it didn't sit well with me.ATT it used more fuel than my 300 RWHP XR6T drive like a piece of S hit went Like a piece of S hit and rock and rolled like a piece of S hit.The Wife and I used to fight over who got the falcon.Only had the car for 14 months spent 6.5k.Getting it decent sold it for 7.3k and wife and swore we'd never buy another and we won't be buying an import anytime soon.

[Ford_The_Win]

Originally Posted by BENT_8

When the auto manufacturing industry in this country collapses, and it will, i hope all the people with imports in their driveway are proud of themselves.

Dont blame the government for killing the industry, blame the people who buy vehicles built offshore!

If everyone who was in the market for a new car in the next 3 months were to buy a Falcon, Commodore, Territory, Camry or Cruze, the headlines would be completely different.

Why is it the consumers' fault? They aren't obliged to spend their money on a product they don't want, that's the name of the game. Local car manufacturing is going down the drain because people don't want full sized family sedans that have been around in the same format for decades. The general perception out there is that other kinds of vehicles are more practical, better built and command better resale. The fact that Territory and Cruze sales match or better those of their big sedan counterparts suggests that.

[Iggle Piggle]

Surely the quoted "40% less in Thailand" is purely labour costs, not the total cost of making the vehicle?

Even if most/all parts are made locally in Thailand, shipping those parts to Aust in large volumes would not add 2.5 times the cost to those parts - and how much of a car's cost to produce is parts versus labour?

[zilo]

They can tell us that we are too expensive to employ, yet they then turn around and expect us Australians to buy their cars with wages paid by companies that do employ australians? That's pretty smug.

I don't think so....you can't crap in the nest and expect a share of worms.

[wrongwaynorris]

Missleading thread title , I could have sworn the title of this thread described Clive Matthew - ( two dads ) Wilson as an automotive expert .

[robbo/region15]

Autodom are obviously mentioned.Are you aware that the OEM's finish next April for Woodville,New Gisborne & Dandenong?
That is a big slice of ones revenue too loose ..........................

[FGII-XR6]

Originally Posted by wrongwaynorris

Missleading thread title , I could have sworn the title of this thread described Clive Matthew - ( two dads ) Wilson as an automotive expert .

remember the meaning of expert. X is the unknown quantity and a spurt is a drip under pressure.