Holden threatens to close factory

[aussie muscle]

Holden getting into politics to shore up their future funding?

Libs to support car industry or 2022 commitment is under question – Holden

GM Holden has called on the federal opposition to clarify its automotive manufacturing policy or risk the future of Australia’s motor industry.

Holden and its parent General Motors have committed to building cars in Australia until 2022, however, managing director Mike Devereux today made it clear that a change in government and policy settings could put that deal at risk.

The Holden deal provides for $275 million in support from the federal, Victorian and South Australian governments, in return for $1 billion in GM investment.

Two models based on global architectures are planned for the Elizabeth plant in South Australia. One will be the second-generation Cruze; the other model is yet to be announced.

That second model line will not be the locally developed Commodore large car, which enters its second and final VF generation in 2013.

Holden is one of three car manufacturers still operating in Australia. The others are Toyota, which opens a new engine plant next month, and Ford, which already has a questionable future beyond 2016.

All three have announced workforce lay-offs in 2012.

Speaking at this morning’s launch of the seven-seat Colorado 7 off-roader, Mr Devereux said the 2013 federal election was shaping as a referendum on the future of car manufacturing in Australia unless a bi-partisan approach was adopted on the issue.

He said he clearly understood the government’s policy on the future of local manufacturing, but the opposition’s policy was not clear to him.

“I need to understand very clearly in a forward looking sense what each party’s policy is on auto manufacturing. Are they committed to making things in this country? Are they committed to fulsome reviews?”

Mr Devereux said that the current adversarial political atmosphere and the unclear opposition position made his regional and global superiors uneasy about ongoing commitment to manufacturing in Australia.

“They ask me ‘What do these things actually mean for future industrial policy, what does this mean, what does it infer?’”

Mr Devereux also admitted frustration at the constant criticisms of government support for the car industry by commentators as well as politicians.

He claimed car manufacturing was a job and investment multiplier but admitted the Elizabeth plant was the second most expensive plant in the GM network globally, which has always put it under viability pressure.

“It is harder work for us to make a go of it in this country than just walking away,” Mr Devereux said. “Walking away is actually easier for General Motors.

“The right thing for our brand and for the people who work here is for us to make things in this country. Now we are not doing that to be nice to this country, we are doing it because it is the best thing for our brand and our business in this country.

“That is why we want to make things here. I think it also happens to be good for the country.”

Asked if he was advocating a vote for the Labor government unless the Coalition became a bi-partisan supporter of the car industry, Mr Devereux said: “My hope is that the auto industry is not an election issue and it is a bi-partisan issue in the election next year.

“It needs to be a bi-partisan issue. I think that there will need to be a review of auto policy no matter who is elected into government next year, in the same way as there was a Button review (1980s) and there was a Bracks review (2008).

“I think there needs to be another broad-based review of both manufacturing and auto policy and I think that is absolutely irrespective of which party takes power.

“It is a country issue, not a political issue.”

However, Mr Devereux conceded that unless there was a change of attitude, the future of the local car industry would be a federal election issue in 2013.

“It would seem to me the issue of making things in this country is still on the public agenda, or at least the political agenda, and it looks like it will be an election issue next year.

“In the United States the issue of making things in the USA and the auto industry was certainly a large factor in the re-election of President Barack Obama. It became an election issue, it was front and centre.

“I believe 2013 will be a year where Australia decides whether it wants to have an auto industry or not, and we still have much to do that in regard even though we have a 10-year plan to invest $1 billion of General Motors money.

“But we still have political discourse in a way to me that is still quite illogical when you look at some of the analogies that you have around the world where this particular industry, because of its bedrock nature, because of the multiplier effect … is an issue of national importance to this country and it doesn’t seem to go away with each passing week and the announcement of another supplier being in trouble.

“These are very significant times in this industry, and we will again be front and centre. Not that I want to be, I just want to sell cars. I don’t want to be part of the political debate in the country.

“Every single time there is one single supplier job lost or one OEM job lost, and everybody says ‘should we be doing this, can we afford to be doing this?’ the question I would ask to most Australians is ‘can you afford not to do it?’”

Mr Devereux contrasted the Australian situation with the UK, where he claimed bi-partisan support of government co-investment policy had resulted in $10 billion spent over the last 24 months by multi-national auto manufacturers, including General Motors, and the guarantee of annual production of more than two million cars per annum within three years.

“The Regional Selective Assistance Program in the UK is the main driver of foreign direct investment because it is a very fertile ground to invest (in).”

The Coalition's stance on automotive industry policy has generally been supportive, but calls for a $500 million reduction in the federal government's $1.5 billion Automotive Transformation Scheme, which runs between 2011 and 2015 and was to be followed by a further $1 billion between 2016 and 2020.

source: http://www.carsales.com.au/news/2012...-factory-33826