Holden To Cease Au Manufacturing

[GH05T]

thought i would throw my 2c in,

i live in the dealer world, i run finance for a large sa dealership so we have obviously been all over this for a long time.

on my side of the fence its a different story, were happy that we finally have an outcome from GMH and GM,

not only will this boost our sales for the "last ausy car" last hsv last "ute" last big and the best gts the end of holden will be a big injection for us for the next 3 years.

slowing sales in big cars...pffft we sell maby 1 or 2 GTS's a week, we sell more hsv than ever and more v8s than ever. they took off. people want faster cars, turbo barinas, bigger engines sports cruzes, then their suvs ect.

proffit margines will go up and price of cars will go down.

just to let you know what happens from here, the commodore isnt actually dead, not yet anyway.

they are planning to import it. not in the range we have now but most probably have a simply badged "SS" and "Evoke" or something like that.

the ute is gone in full, that was axed 6 months ago.

they are already lining up for our replacement model/ models

the lead time is 3 years which is why the date for closure is 2017.

we will be getting a few test models through soon, see what takes and what dosnt do expect some randomnes over the next 5 years.

sucks for the factory and their families, allot of older guys who have been there for 10+ years and they will struggle, elizabeth and the northern subburbs will drop a bit too as its going to stagnate somewhat.

we will see people slowly leaving and they may closer ealrier than expected and just rund down a skeleton staff as people will leave for oppertunities as they can grab them, our dealership has put its hand up to employ as many as we can in parts and retrain for service, i hope others do the same.

just FYI we have also began registering dealer/ business names under gm/ chevrolett and the liks, you may see the end of the holden name soon....just sayin.

Edited December 11, 2013 by GH05T

[Anfanee]

I love Australian Media and politics. This story has been made HUGE in the media. Lets leave out the tens of thousands of public servants that are not out of the job as well and will struggle to find one. It has not been viable for companies to make cars here for a long time. It has just taken a while for everything to catch up. I really do feel for the families. But they are in no different situation than a lot of other people.

How could holden expect the commonwhore to keep selling the way it was when there are cars like the 2015 Mustang selling for 45k brand new? Unfortunately this was going to happen.

They had three main options:

Drop the price of the commodore/Falcon

or

Stop making them altogether and make more cars here like the focus or the cruize

or

Leave AU alltogether.

They chose the latter. And at the end of the day GM are a business and need to make money. Any other business would have done the same thing. There was no use the Government throwing millions at them to try to get them to stay. It would have only delayed them leaving by a few years.

Lets just hope we will still mark parts for the car. Though i doubt it.

[GTR-N1]

"Football, meat pies, kangaroos and foreign cars"

[SilverECR33]

all I see is BS all over this thread, the fact of the matter is, the government should not keep wasting our tax dollars on a company (or any company for that matter) that is being driven into the ground by incompetent Management.

sometimes you cant just throw money at a problem to make it go away, and here has been a good example of that. If they wanted to help, they should've seized the company and restructured it replacing the CEO and hired talented BA's and Business leaders. But the truth is that the government is just as incompetent as they are.

[bozodos]

If there's one thing that's become clear, it's how well the media have played their part in destroying the local car industry, starting with this insane notion that the government was tipping ridiculous amounts of money into the local producers for no benefit. Even accounting for economies of scale, our automotive market is FAR less subsidized than nearly every other country that manufactures cars, and also without the tariffs to protect the locally made product.

I would also say it's very likely that Toyota will also shut down, followed by the various component manufacturers. I think that the bullying tactics by the current Government were the last straw. It'll be a sad day for Australia when that factory closes.

[Lolrick]

I'm keenly anticipating any changes to vehicle legislation, and the effects of this on the new and used vehicle market. For example, with falling tariffs and no need for any protectionism (at all) can the Government wind back things such as the Luxury Car Tax? Will importers pass on savings (assuming AUD stays steady for a while) and will our overall new prices drop? Perhaps, mostly significantly, will the restrictions on parallel importing be removed?

OR, will we remain a dumping ground for the world's manufacturers and have the Government continue to see motorists as revenue raisers (as we are powerless to resist, really - no way of 'voting with our feet')

Can i also mention, we have just signed a free trade agreement with Korea - this is not necessarily significant because we will soon have access to Kia/Hyundai/Daewoo-Holden imports without tariffs, but because our parts suppliers can now have a crack at the Korean market. Korea isn't necessarily cheap, either, so Australians may be able to compete with this agreement. The volumes sure are larger!

Many sources in the mainstream media have cried that the parts suppliers are the ones that will make up the bulk of the job losses... but the fact is, these guys were slowly getting phased out regardless, either through winding up business due to decreasing Australian manufacturing demands, or because they were already moving off shore, most notably to Thailand. I may stand slightly right-wing here, but it naive and a real entitlement issue to think that anyone should be guaranteed a job for life, especially in a competitive global environment. Yes your Government should look out for you, but you can't expect to see no hardship.

While it sucks to have many job losses, speaking more specifically to the auto assemblers, I don't see why they should attract particular sympathy - business closing down is just another part of business. When Bowen announced the FBT implications in July, this could have set tens of thousands of people to lose their jobs in the salary packaging industry, yet there was no public outcry to have these people on generous severance packages and re-training programs. In fact, all that i heard were people saying about time we ended the tax rort (if someone would like to discuss how FBT is not a tax rort, I'm happy to take the time) Similar to the GFC, where many white collar workers simply found themselves out of jobs, there was no ready support, excluding the existing structures (centrelink)

[GTR-N1]

Aust has always been lax on tariffs. Aussie gov'ts Labor and Liberal have alway relied on quotas, ADRs and brand selectivity as I recall in the 70s.

When I bought a new Datsun 1600 off the showroom floor and then went on overseas pharmacy trips, I noticed that many countries had tariffs of 100% on imported cars.

A Yu Loong (aka Datsun) would cost little in HK and Taiwan, but a Holden would cost 2.5x as much as here.

Aust was afraid of losing sales on agriculture as a trade off, and even since then, Aust is still only imposing luxury taxes whilst Holden wilts on the vine.

Combine that with the fact that over the past 20 yrs, the Aust gov't has forked out over 2.1 billion propping up GMH whilst unions have successfully gained higher and higher wages (and bonuses) for the blue collar guys. The golden egg is now dead for these guys.

In short, everyone is at fault. If I was given the choice of buying 10x GTSs (to keep Holden breathing) against 10x grey imports of my choice, I'd still choose the latter. So consider me at fault too!!!

[Lolrick]

In short, everyone is at fault. If I was given the choice of buying 10x GTSs (to keep Holden breathing) against 10x grey imports of my choice, I'd still choose the latter. So consider me at fault too!!!

You say "consider me at fault, too" - but really, we are consumers, and are not obliged to purchase something just because it is made in Australia. Many consciously choose to support Australian business (which is positive!!) but generally people will vote with their wallets, as they are entitled to. For many, Commodores just aren't the right size, cost, or image.

That said, I've driven a VF Ute and Calais, and I'm quite impressed. Engine is fun, not tooooo thirsty, and the interior is finally representative of a 21st century vehicle. Most importantly, there have been half decent price drops across the board.

However, Holden just don't make enough margin on most of their commodore sales (margin is high - they don't cost much more to make than a cruze but sell at a premium, but there are overhead costs to recover) because they give many of them away at close to cost price - for example, the Federal Government sure isn't paying retail price, and any reasonably priced fleet is getting massive discounts too. Commodore might be in the top 5 sales from VFACTS, but they just aren't making all that much money.

Yeah, the AMWU has had a cruisey few decades here, and will be paying the price. I hope that they, and the transport workers union, cease to exist after Holden and QANTAS go. Don't get me wrong, I appreciate what the unions have done for us, but we needed them 2 decades ago, their job is done. Australians have it too easy already, and now unions just seem to be a cash cow for certain party members.

Further, the issue isn't just pushing for more money/less hours etc - for some reason, the AMWU seems to have a hand in strategic decision, which was hard enough for Holden in the first instance being an American subsidiary in a vastly different market. Things such as robotics were issues cited that were blocked by unions, as it would cost assembly lines people's jobs - if only we could see the whole picture, where instead of a relatively unskilled assembler, we could have had opportunity to research, build and develop - and then maintain - innovative technologies such as these robots.

[blackrex]

http://www.news.com.au/finance/business/toyotas-fate-sealed-by-federal-court-ruling/story-fnkgdhrc-1226782002606

Toyota wants to restructure their EBA to make the company more effective and reduce costs, they want to have a vote of all employees as to whether they can proceed with negotiating on the changes and 4 employees take them to the high court and win, stopping the vote from happening. The current EBA expires in March 2015, anyone want to bet that the bosses at Toyota will now be seriously contemplating keeping the business alive here?

[Nee-san]

The High Court ruled against Toyota.

Unfortunately this means that they will more than likely shut down their operations in Australia.

Unless something can be done when the current EBA expires in 2015, unfortunately the decision has to be made before then.

You may thank the AMWU for this.

Edited December 12, 2013 by Nee-san

[GH05T]

excelent article well written and unbiassed, all should read

http://www.autonews.carsales.com.au/industry-news/2013/large-passenger/holden/commodore/the-holden-blame-game-40606

[Lolrick]

I'd hate to link to the SMH, but I found this opinion article a good time-line, free from usual media sensationalism

http://www.smh.com.au/federal-politics/political-opinion/steam-under-the-bonnet-20131213-2zctr.html

[bozodos]

excelent article well written and unbiassed, all should read

http://www.autonews.carsales.com.au/industry-news/2013/large-passenger/holden/commodore/the-holden-blame-game-40606

good article that, the union bashers should give it a read.

At the end of the day, above all of the other factors involved, the constant media negativity, and unwillingness of successive governments to keep kicking in a small amount of money to a business (well businesses if you include Ford), that generated billions of dollars in revenue a year, not to mention GM gimping the export possibilities, and Ford not even entertaining it meant the end for the local carmakers. If you think Toyota is going to stick around now that the precedent has been set, I think you're fooling yourself.

The wage cost was a relatively small factor in it all, despite what the Herald Sun might have you believe. We actually subsidize our carmakers a lot less than most countries, even accounting for economies of scale. The extremely fragmented new car market here doesn't help either.

It's terrible how this country is becoming increasingly reliant on minerals and services when it has been shown that it is not enough to have a sustainable economy, with national institutions being flogged off to foreign owners.

[Cowboy1600]

good article that, the union bashers should give it a read.

At the end of the day, above all of the other factors involved, the constant media negativity, and unwillingness of successive governments to keep kicking in a small amount of money to a business (well businesses if you include Ford), that generated billions of dollars in revenue a year, not to mention GM gimping the export possibilities, and Ford not even entertaining it meant the end for the local carmakers. If you think Toyota is going to stick around now that the precedent has been set, I think you're fooling yourself.

The wage cost was a relatively small factor in it all, despite what the Herald Sun might have you believe. We actually subsidize our carmakers a lot less than most countries, even accounting for economies of scale. The extremely fragmented new car market here doesn't help either.

It's terrible how this country is becoming increasingly reliant on minerals and services when it has been shown that it is not enough to have a sustainable economy, with national institutions being flogged off to foreign owners.

Bang, you nailed it completely.

[wht510]

This!

http://adriantout.blogspot.com.au/2013/12/interventionism-kills-industry-not-free.html

High wages (Australia the 3rd highest 'average' wages in the world)

"Keeping the lion in the zoo for too long"

Central banks don’t want deflation. They want inflation. Hence all the 'control' by the big banks and the RBA. They want spending to try and reduce the deadly 'recession' we have to have...

[TTR34]

Australia really needs to get on the technology band wagon and create industries that will see us and our children into a new era. When something doesn't work, fix it or leave it.

[Birds]

We're pretty forefront as far as technologies go...there's more than a few industries where Australian developed technologies are head of the game.

[Nee-san]

http://www.youtube.com/watch?v=pN60DR5GQpg

[wht510]

We're pretty forefront as far as technologies go...there's more than a few industries where Australian developed technologies are head of the game.

Yep, and then we sell off to a foreign owner because we can't support the technology, or there's more money involved if we sell off.

So many Australian inventions are sold off to OS investors and before you know it, we own ZIP of the IP.

CSIRO is doing nothing these days instead of the power house it was back in the 60's and 70's for example.

[Birds]

I agree mate.

Education is probably our biggest IP sell off, what with the number of student visas these days. It's a money maker itself, building student accommodation and immigrants spending their overseas money here...but the end game when the dust settles, is that local students lose out on tertiary education places and, once that student visa is done with, we kick them out of the country anyway = invent or entrepreneur something overseas.

Clap clap!