Holden looks for saviour in funding discussions
In meetings being described as ‘‘crucial’’ to Holden’s future – as well as that of rival car maker Toyota and the accompanying parts supply chain – managing director Mike Devereux will host Industry Minister Ian Macfarlane on a tour of the company’s Adelaide manufacturing facilities.
It is understood South Australian Premier Jay Weatherill, independent Senator Nick Xenophon and possibly former Labor industry minister Greg Combet will be among those in attendance for the tour and subsequent sit-down discussions. Workers are anxiously awaiting the outcome of the talks, with Holden poised to make a decision on its long-term future in the coming months.
Australian Manufacturing Workers Union SA secretary John Camillo said workers were urgently seeking clarification on their futures.
‘‘You have 1700 Holden workers in the component sector worrying day-in, day-out on whether there’s a future for them beyond 2016,’’ Mr Camillo said. ‘‘It’s the same emotional rollercoaster they went through when Holden decided workers needed to take pay cuts. The final straw now is waiting on the government to make that decision: are they going to put that additional money in for a 10-year co-investment plan?’’
In August, Holden workers accepted a variation to their enterprise agreement to help the company achieve $15 million in annual savings. Among the measures agreed to were a three-year wage freeze and adjustments in overtime and meal break allowances.
‘‘Workers have given up a lot in regards to wage freezes and doing everything the company wants. Now we’re just waiting on the Abbott government to give the go-ahead in regards to the replacement of the Cruze and Commodore,’’ Mr Camillo said.
Government co-investment is crucial to General Motors’ $1 billion plan to continue producing cars locally until at least 2022.
Before the election, the Coalition vowed to make $500 million in cuts to car industry funding. Last month Prime Minister Tony Abbott reiterated plans to boost export numbers from Holden and Toyota in a bid to improve sales.
An insider close to negotiations said Holden’s future was highly dependent on flexibility from the recently-elected government.
Frequently Asked Questions about this Article…
General Motors Holden has begun funding talks with the Abbott government aimed at salvaging the Australian car manufacturing industry. The discussions — described as crucial to Holden and rival Toyota and their parts supply chain — include a tour of Holden’s Adelaide facilities with Industry Minister Ian Macfarlane and follow-up sit-down negotiations.
Government co-investment is described as crucial to General Motors’ $1 billion plan to keep producing cars locally until at least 2022. Holden and its suppliers are waiting on a government decision about longer-term funding, including whether there will be support for a multi-year co-investment plan.
Before the election the Coalition vowed $500 million in cuts to car industry funding, and an insider said Holden’s future depends on flexibility from the newly elected government. The Prime Minister has also talked about boosting export numbers for Holden and Toyota to improve sales — so policy on funding and export support will directly affect both manufacturers.
Workers are anxious about the outcome of the talks. About 1,700 component-sector workers are reportedly worried about their future beyond 2016. In August Holden employees accepted changes to their enterprise agreement to help the company achieve $15 million in annual savings, including a three-year wage freeze and adjustments to overtime and meal break allowances.
Holden is poised to make a decision on its long-term future in the coming months, and workers are waiting on a government go-ahead for replacements of key models (the Cruze and Commodore). The outcome of funding talks and any co-investment commitments will influence that decision.
Holden’s managing director Mike Devereux is hosting Industry Minister Ian Macfarlane for a tour of Adelaide facilities. South Australian Premier Jay Weatherill, independent Senator Nick Xenophon and possibly former industry minister Greg Combet are expected to attend. The Australian Manufacturing Workers Union (AMWU) SA secretary John Camillo is representing worker concerns.
Based on the article, key risks include uncertainty over government funding and co-investment decisions, potential cuts to industry support, delayed or cancelled model replacements (like the Cruze and Commodore), and labour and supplier disruption. Those factors could affect production continuity and the financial outlook for manufacturers and component suppliers.
Investors should watch the outcome of the funding talks with the Abbott government, any government decision on a 10-year co-investment plan, announcements about replacement models for the Cruze and Commodore, government export-support initiatives, and updates on GM’s $1 billion local production plan and related timelines.
Call 1300 880 160
Start a chat
Schedule a call
