Tuesday, June 2, 2009

Holden To Be Part Of New GM; Normal Operations To Continue


HOLDEN ANNOUNCED late last night that it is to continue normal operations in Australia and New Zealand, and will not be adversely impacted by General Motors’ filing for bankruptcy protection in the US.

In news certain to be welcomed by the Rudd Government and Holden’s employees and suppliers, Holden said there will be no direct impact on its Australian design, engineering and manufacturing operations, nor will there be changes to Holden employees and supplier payment arrangements.

Holden’s 6000 employees, who may have been watching developments in the US nervously over the past six months, can now breathe a little easier.

“Operations at Holden are unchanged in Australia and New Zealand and we expect it to remain that way,” Holden Chairman and Managing Director, Mark Reuss, said.

“GM has clearly stated that all of its businesses in the Asia Pacific region, and that includes Holden, (will) continue normal operations and are not directly impacted by this process in the US.

“Beyond that, GM has indicated that Holden will be an important part of the New GM,” he said.


Having last December made a $6.2 billion commitment to the local industry under the New Car Plan For a Greener Future, the Rudd Government and Industry Minister Senator Kim Carr might be thankful that the investment would appear to be paying an early dividend.

Holden, who spent $420 million on research and development last financial year – more than any other private company in Australia – has Australia’s largest and longest running automotive export program, having delivered more than 775,000 vehicles to overseas markets.

Importantly, neither Holden nor any operations outside the US are included in the Bankruptcy Court filing, nor will it be included in the Court-supervised restructuring process.

“Holden is a subsidiary of GM but we are a corporate entity in our own right – an independent company under Australian law,” Mr Reuss said.

Certainly, while facing challenges of its own for profitability in the current market, Holden’s cause is certain to be assisted by the performance of the Commodore which has been Australia’s top-selling vehicle since 1996.

Neither Holden’s operations at Elizabeth in SA nor Port Melbourne in Victoria will be affected by the filing. Local production of the Cruze is to go ahead as planned.

There will also be no changes to dealer and warranty arrangements.

With a media conference scheduled for 9:00am AEST this morning (June 2nd); we will keep you posted of any developments.