THE manufacturing future of Holden is not likely to be decided until next year as negotiations between General Motors and the Federal Government are on hold pending the outcome of a Productivity Commission review.
Although General Motors board members in Detroit this week have a routine monthly meeting about the company's global operations - during which Holden will be a brief "line item"- a formal decision regarding Holden's factory operations is not expected to be made until next year.
Although senior Holden executives admit the outlook is grim given the Federal Government's pledge to fulfill its pre-election promise to cut industry funding, News Corp Australia understands a decision has not been made to shut the factory.
The long wait means 1700 Holden factory workers at the Elizabeth car assembly line near Adelaide will go into the summer holiday break not knowing their long term future.
Holden sales are at a 20-year low as imported cars dominate the market. SOURCE:news.com.au
If Holden decides to close its factory operations, a secret document reveals it could happen as early as 2016, the same year as Ford is due to close its Victorian factories.
News Corp Australia has learned the December meeting of General Motors board members is due before the preliminary Productivity Commission report is delivered to the Federal Government on December 20.
Industry Minister Ian Macfarlane tours the Holden factory in Elizabeth. Source: News Limited
This means that a formal decision about Holden is unlikely until mid-January at the earliest, when the regional bosses of General Motors -- including former Holden boss Mike Devereux and GM's international operations boss Stefan Jacoby who visited Holden for two days last week -- will meet at the company's global headquarters during the Detroit Motor Show.
The outcome of the preliminary Productivity Commission report to be delivered in December is expected to influence General Motors' decision.
If it does not recommend an increase in subsidies, then GM may announce a factory shutdown by the end of January.
If the preliminary Productivity Commission report comes out in favour of an increase in taxpayer assistance to the industry, General Motors could wait until after the final PC report is due to be tabled on March 31, and then wait to see what action the Federal Government takes based on the recommendations.
At stake is whether or not Holden will close its manufacturing operations at the end of the current Commodore's life cycle or proceed with two new models scheduled to be built from 2016 to 2022.
In March 2012, Holden announced it would invest $1 billion in two new cars in return for $275 million in taxpayer assistance.
But less than a year later Holden said it needed more public funding because market conditions had "changed significantly" since the original deal was signed.
Holden sales are at a 20-year low as imported cars buoyed by the strong Australian dollar dominate the market
Before Ford announced in May 2013 that it would close its manufacturing operations in October 2016, the leadership team in Detroit discussed Ford Australia's operations in more than 300 weekly meetings over seven years, Ford CEO Alan Mulally told News Corp Australia during his visit to Sydney in August.
Ford decided to announce the closure of its Australian factories three years in advance -- unusually long in the car industry -- to allow workers and suppliers time to adjust.
If Holden shuts its manufacturing operations, General Motors is likely to announce the news soon after the decision is made at board level.
Ford announced the closure of its Australian manufacturing operations less than a week after the decision was made formally at a board meeting in Detroit.
SOURCE:news.com.au
SOURCE:news.com.au
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