Holden, a subsidiary of GM is about to exit from Australian car market in 2016. They have decided to pull out of vehicle production in this region. The Australia’s auto industry has been under pressure for years as high costs, a strong local dollar, weak exports and tough international competition take a toll. Which may be influenced Holden to warp up from Australian car market.
Though, Holden is mentioning this as rumors and no official statement was made, The ABC & the Australian mentioned that info was leaked from the senior offices of Government ministers that Holden was planning to announce the decision this week and had informed Government of its intentions. However they postponed the announcement until next year.
Mr Weatherill who is South Australian Premier said that he had spoken to the CEO of Holden Mr. Mike Devereux who had rejected the reports and repeated that no decision had yet been made. He said the leaks to the media were intended to not only demoralize Holden’s confidence in the future, but public confidence. ”They’re trying to shift the blame to Holden,” he said. ”They’re saying it’s all over to Holden.’’
Industry spokesman Kim Carr said – ”Far from the calm and methodical Government Mr Abbott promised, we are seeing nothing more than division and dysfunction, with Australia’s automotive industry the latest victim,” He also added that – ”We understand that no decision has yet been made by GM Holden, however it is on a knife’s edge.” He said the government was now speculating about itself in the media, ”and revealing deep internal divisions in a desperate bid to find an alibi for its indolence”
The Australian car industry make employments for moreover 50,000 people and funds 200,000 other manufacturing jobs. Holden is one of biggest part of this industry with claiming 10.8 percent of the Australian market with 10,477 sales in November. However, they posted an A$153 million loss in 2012. It produced around 95,000 vehicles including its top selling Commodore and Cruze, with car exports making up less than 14,000. When it shuts up its Elizabeth plant, Holden, the GM brand, will turn itself into a minority player overnight. We will see its market share tumble from 10 percent to less than three percent.
And any exit by Holden is likely to shake the whole economies of scale at Toyota Motor Corp. Ford Motor Co will also shut its two Australian auto plants in October 2016 which is followed by the exit of Mitsubishi Motors occurred in 2008.
So whatever its a rumor or true fact, these is really very dangerous for local car manufacturing, for those businesses that rely on the sector, for the communities of workers and families that rely on both. And for car dealers carrying the Holden brand, and the thousands they employ.
