With our continued reports on the fate of Australia’s auto industry, the future looks dimmer and dimmer. It was announced yesterday that Holden’s Elizabeth plant in Adelaide could close down by years end! Holden has been vocal about their lack of profitability thanks to high costs of manufacturing, not surprisingly citing high labor costs as a real challenge to staying afloat. Ford has already said they will be leaving Australia in the coming years, and Toyota has also voiced their concerns. With $500 million dollars worth of Australian Federal Government subsidies coming up for renewal, Southern Australia’s State Government is worried.
Southern Australia Manufacturing, Innovation and Trade Minister, Tom Kenyon has stated that the State Government has committed $50 million to Holden, but that he doesn’t know what will happen with the Federal spending. This concerns him and the people of Adelaide as this would be a big hit on a local economy that is working to get out from under dependency on the auto industry. But they aren’t there just yet, and need Holden there to allow their economy to grow in different directions.
Local SkyNEWS Video Below
Our favorite part of this story is a quote from Tom Kenyon who said “This is not some idle threat, this is not some game that they’re playing to try and screw more money out of the Government.” We love that!
With thousands of jobs on the line, you would think this top priority issue would be something they wanted to handle today, but as is often the case with things at this scale, meetings with Holden executives and government are not scheduled until September, following meetings in Detroit where top GM Executives and GM Holden Executives will discuss options and plans.
For the sake of Australia, and the auto industry in general, we hope that they are able to come to some kind of agreement that makes sense for Holden, the people of Southern Australia, and Australia’s economy in general.
We’ll keep you posted.
According to my very inside Antipode source …. all automotive production in Australia will cease by no later than 2018 . Simple fact is their government …. much like ours … has been subsidizing automotive production [ specifically Holden and Ford ] .. for decades …. with zero return – rapidly diminishing jobs etc … again .. much like us . BUT ! Unlike us ( US ) with ObamaClaus at the helm … those Aussies have gotten fed up with throwing good money after bad … and have cut off the automotive industries lifeline on the national level . So take GM’s excuses for what they are …. an attempt to cover up their own failures over the decades …. Hmmn ….. Sound a bit familiar ?
If Toyota is even getting out of the game there, there is more to it than simply GM (and Ford) excuses.
What will this do to the Chevy SS Chassis? That is based on a Holden Car like the Pontiac G8 was.
I don’t think its GM’s or Holdens fault that vehicle manufacturing in Australia stuffed! Its the Government and the fact that they let anybody outside of Australia import a vehicle with little to no Tariffs to compete against their own manufacturing, Which has led to all the Automotive manufacturers closing shop! The Government shouldn’t necessarily be giving money to the manufacturers, but supporting them by making it easier to buy Australian manufactured products! Put markups on imported items, and give incentives to buy Australian made!
The Government needs to support local manufacturing first, not imports!
I think this explains it all:
http://www.youtube.com/watch?v=clI2-Hs9W-M
Actually, it’s more teh fault of the unions than the government. Holden have cited ‘the cost of labour’ as one of the issues. The unions continue to push harder and harder for higher wages. A 4-5% sallary increase every year compounds pretty quickly, and you end up with guys fitting windscreen and installing carpets getting paid over $90,000 pa. That’s why Australian manufacaturers with overseas companies with low labour wages and much less stringent safety requirements.
The Corporates claim Union wages, but prior to the US bail out 6 of 10 dollars in Auto cost were executive pay pension, and benefits, after dumping pensions, healthcare and the high union pay, the car prices have accelerated higher, for huge profit margins… yet US is still not competitive with Asia, Mexico, and the rest of the 3rd world, because we don’t live in mud huts, we have paved roads, sewer and water, indoor plumbing, and dreams of retiring…