Car makers fear curtain may fall
"We know that Ford's leaving - if Holden decides to leave, then we don't believe Toyota is sustainable," Diver Consolidated Industries chief executive Jim Griffin said.
"That means the industry will effectively die in three to four years and that would just about be curtains for us."
Ford has committed to closing its plants in 2016 and Mr Griffin argues that if Holden was also to shut down, that would force suppliers out of business, leaving Toyota without enough of a manufacturing base to make its local operations viable.
Based in the northern Melbourne suburb of Reservoir, Diver employs 115 people stamping, diecutting and welding parts, 70 per cent of which are supplied to Ford and Holden.
"We are [a] company that's been supplying to Holden since 1948, so if they were to leave the country it would be not very good news for us whatsoever," Mr Griffin said.
He said speculation about Holden's future was "unhelpful".
Holden may reveal more about its plans on Tuesday, when it appears in front of a Productivity Commission inquiry into the automotive industry. An interim report is due before Christmas.
Richard Reilly, the chief executive of the Federation of Automotive Products Manufacturers, said Holden buys more than $2 billion worth of parts every year.
"If Holden ceases [to] manufacture here in the medium term there's no doubt some companies will cease [to] manufacture in Australia ... Thousands of jobs would be lost."
FAPM estimates that of about 45,000 people employed in the car making industry, between 30,000 and 33,000 work for parts makers.
Mr Reilly said those businesses faced "diabolical scenarios" if only Toyota remained in Australia.
"Essentially the question is: can you have an automotive industry with one manufacturer here? I think it's pretty unlikely."
Mr Griffin attacked free trade agreements entered into by Australia, saying they did not help car makers enter foreign markets.
He said he wanted the government's support of the industry to continue.
"Australia really needs to make a decision - they either want an elaborately based automotive sector or they don't, and if they don't we're going to have to find something else for these people to do ... I'm afraid I can't see that there's anything else for these people to do and it's going to leave a huge hole."
Frequently Asked Questions about this Article…
If Holden quits manufacturing in Australia, it would devastate car parts manufacturers and result in thousands of job losses, as many companies rely heavily on supplying parts to Holden.
Ford's decision to close its plants by 2016 puts additional pressure on the Australian automotive industry. If Holden also shuts down, it could force suppliers out of business and make it difficult for Toyota to sustain its local operations.
Holden's future is crucial because it buys over $2 billion worth of parts annually. If Holden ceases manufacturing, it could lead to the closure of many companies and the loss of thousands of jobs in the industry.
Diver Consolidated Industries, based in Melbourne, employs 115 people and supplies 70% of its parts to Ford and Holden. The company's future is closely tied to the continuation of Holden's manufacturing operations in Australia.
If only Toyota remains, the automotive industry may not be sustainable, leading to 'diabolical scenarios' for parts manufacturers and potentially resulting in significant job losses.
Free trade agreements have been criticized for not helping Australian car makers enter foreign markets, which adds to the challenges faced by the local automotive industry.
The Federation of Automotive Products Manufacturers believes that if Holden stops manufacturing, it would lead to the closure of some companies and the loss of thousands of jobs, as Holden is a major buyer of automotive parts.
Industry leaders are calling for continued government support to maintain an elaborately based automotive sector in Australia, warning that without it, there will be a significant economic impact and job losses.
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