‘Hundreds of firms’ to benefit in Holden deal

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‘Hundreds of firms’ to benefit in Holden deal

Updated March 22, 2012 18:17:51

Industry bodies and unions have welcomed the $275 million assistance package for General Motors Holden, saying the benefits of the deal will flow through the economy.

General Motors Holden will receive $215 million from the Federal Government, $50 million from the South Australian Government and $10 million from the Victorian Government as part of the deal.

The package will be handed over in return for a $1 billion investment from Holden to make two new car models at its Adelaide plant, with a guarantee that it will maintain operations in Australia for at least the next decade.

Prime Minister Julia Gillard says it will save thousands of jobs, but the Opposition says it wants to know the details before it commits to honouring the deal if it were to win government.


Federal Chamber of Automotive Industries chief executive Ian Chalmers says the funding will benefit hundreds of manufacturers throughout the country.

“It’s not just about the big assemblers, the big plants that General Motors owns here in Australia, but it’s the hundreds of companies – individual, separate companies – that manufacture small or sometimes quite large assemblies,” Mr Chalmers said.

“They’re the component manufacturers that supply components to companies that actually assemble and build the cars.”

As the manufacturing sector reels from recent high-profile job cuts, the Australian Manufacturing Workers’ Union (AMWU) says the package should serve as an example for other government support measures for the sector.

Snapshot: Australia’s automotive industry

  • The Federal Government budgets more than $3.5 billion to its New Car Plan to support the industry
  • More than 1 million new vehicles sold annually
  • Toyota has the lion’s share of the market, selling 21 per cent of new vehicles hitting the road.
  • Next is Holden with 13 per cent, with Ford on 9 per cent.
  • In the passenger car market, imports outsell locally-produced vehicles by nearly 4 to 1.
  • Australia’s vehicle and components exports are worth more than $3 billion annually.
  • The Middle East (44 per cent) is Australia’s biggest automotive export market.

All figures as of 2010. Click here for more info.


Thousands of workers will benefit from the move, says AMWU national president Paul Bastian.

“There’s 200,000 that rely on the auto sector, so this is great news,” Mr Bastian said.

“It’s great news for the Holden workers, it’s great news for all those that work in the auto sector, and it’s going to provide some certainty and security for a key sector of our manufacturing industry. So it’s very welcome news, and it’s what governments should be doing.”

And Go Auto Media motoring writer John Mellor believes the funding boost is critical if Holden is to reposition itself for the future.

“What we are seeing is a transformation of Holden,” Mr Mellor said.

“Clearly the Commodore-size vehicle is falling from favour both here and overseas, so this is good news for the Australian car industry.

“If it takes them through into the next decade that’s very good news.”

Holden employs 4,600 people nationally, including about 2,400 in Adelaide and around 2,000 in Melbourne.

“In January this year we were at real risk that there would be no more Holden in Australia, that we wouldn’t have Holden here producing motor vehicles,” Ms Gillard said.


“That wasn’t acceptable for me as Prime Minister and it wasn’t the right thing for the nation’s future.

“It would’ve been a knockout blow for manufacturing in this country, given the importance of the auto industry to all of manufacturing.”

But the Federal Opposition said while it is not “averse” to supporting the car industry, the Government has had a “shambolic” approach.

“There needs to be certainty and clarity and transparency, and they’re not onerous or high benchmarks when Government funding, when taxpayers’ dollars, are involved,” industry spokeswoman Sophie Mirabella said.

Spending breakdown: The New Car Plan

The Federal Government groups its assistance to the car industry under the umbrella of what it calls its New Car Plan. Before today’s announcement the spending included:

Information: www.innovation.gov.au

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