Federal Government Calls on Holden Boss Mike Devereux to Give Australia the Truth About Its Future _ News.com

8/13/2019 Federal Government Calls on Holden Boss Mike Devereux to Give Australia the Truth About Its Future _ News.com

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Federal Government calls on Holden boss MikeDevereux to give Australia the truth about its

future

Joe Hockey: Car industry's future in its own handsHolden wants $150 million of taxpayers money to stay openSA Premier to lobby PM over saving Holden in AustraliaHolden urged to declare its future plansHolden Cars For Sale: Carsguide

HOLDEN'S future has dominated a heated Question Time after Warren Truss and Joe Hockey put pressure on

them to be"fair dinkum" with Australians.

As the majority of questions were devoted to the ailing carmaker, act ing prime minister Warren Truss said he had writtento Holden boss Mike Devereux today calling on him to urgently clarify whether or not the company will shut up shop inAustralia.
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Mr Truss told parliamentary question time it was important Holden workers knew their fate before Christmas.

He said comments this morning from Mr Devereux at a Productivity Commission hearing that no decision had beenmade over Holden's future were unhelpful.

"The comments made by Mr Devereux this morning just adds to the uncertainty," Mr Truss said.

"Today I have written to the general manager of Holden, Mr Devereux, asking General Motors to make an immediatestatement clarifying their intentions in this country.


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"They owe it to the workers of General motors not to go into the Christmas period without making a clear commitment tomanufacturing in this country."

Treasurer Joe Hockey echoed Mr Truss's comments and said that it was time for Holden to be honest with Australiansabout their intentions.

"Either you're here or you're not," Mr Hockey said.

Mr Hockey also said it was important for Labor to back the government in calling on Holden to "come clean" and be "fairdinkum" with the Australian people.

The government's demands on Holden's GM come after the company contradicted Federal Government leaks by

emphatically declaring "no decision has been made" to close its manufacturing operations in Australia.

However a formal decision to shut the Elizabeth car making factory is believed to be a formality given the hard linestance of the Federal Government to not increase taxpayer funding to the industry, and Holden's request for moreassistance.

SHOULD TAXPAYERS CONTINUE TO FUND HOLDEN? COMMENT BELOW

News Corp Australia understands the decision to shut Holden's manufacturing operations will eventually come fromGeneral Motors executives in Detroit, but Mr Devereux and other Holden executives this morning declined to speculatewhen that might occur.

In a Productivity Commission hearing today, Mr Devereux repeated Holden's earlier arguments for an increase intaxpayer funding, including its claim that its manufacturing operations created $32.7 billion in economic activity over thepast 12 years.

However, Mr Devereux also confirmed for the first time that the two vehicles it planned to build from 2016 to 2022 willhave much lower levels of local content.


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It means that saving Holden won't necessarily save up to 50,000 jobs in the rest of the automotive parts supply industry -one of Holden's central arguments during its campaign.

"We've been relatively public that were we to move forward the general notion is that you would see globalisationlevels for suppliers more in line with what you have today on the Cruze," Mr Devereux told the hearing.

Earlier, Mr Devereux said the local content of the Cruze was "25 to 30 per cent", compared to 50 per cent for theCommodore.

By comparison the local content of the Toyota Camry and Ford Falcon is 70 per cent, according to figures supplied bythe car makers.

The deputy chairman of the Productivity Commission and the presiding commissioner on the inquiry into the automotiveindustry, Michael Woods, asked Holden for access to a report prepared by Adelaide University Professor Goran Roos.

The secret document, as reported exclusively by New Corp Australia last month, revealed Holden's plans for a"significant reduction" in the local content of its future models.

The report, labelled "Cabinet in Confidence", was prepared in August 2013 with co-operation and input from Holden andthe unions.

After the hearing Mr Woods told News Corp Australia: "We certainly did want to inquire what would be the localcomponentry of the new models. The whole supply chain is of very great concern to our deliberations."


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Speculation has been building about the company's future since Ford announced in May that it will shut its Australianfactories no later than 2016.

Holden has previously said that local manufacturing cannot compete globally without public assistance.

Holden's submission to the inquiry said it had generated $32.7 billion in economic activity in Australia from 2001 to 2012and received $1.4 billion in federal government assistance.

Mr Devereux refused to say when General Motors would make a decision about the company's future in Australia.

The Productivity Commission will submit its final report to the government on March 31.

Meanwhile, the Greens have warned Australia will fall into recession if the government doesn't do enough to save ailingcarmaker Holden.


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Reaction to possible Holden closure

South Australian Premier Jay Weatherill has warned Prime Minister Tony Abbott there will be "a massive political price

to pay" if he does not commit funding to keep Holden in Australia.

Responding to Holden's general manager Mike Devereux's declaration no decision has been made to close thecarmaker, Mr Weatherill said the "gutless" people who had been claiming Holden's fate was sealed "can shut up nowand actually get in behind holden".

"Mr Devereux has said that they (Holden) have not made a decision to close and he has said that they want to keepmaking cars in this country," Mr Weatherill said.

"It's now over to the Federal Government."

Mr Weatherill rejected the suggestion that a decision may have been made by General Motors in Detroit but not

communicated to South Australia yet.

That would suggest Mr Devereux had lied to the Productivity Commission inquiry, Mr Weatherill said.

Mr Weatherill will meet with Mr Abbott on Thursday to urge him to recommit $500 million in automotive industryassistance and to secure a future funding agreement for Holden.

The future of Holden was now in Mr Abbott's hands, Mr Weatherill said.

When questioned whether Holden would be lost if he couldn't convince Mr Abbott to put money on the table MrWeatherill said "it comes down to that".


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If he could not convince Mr Abbott on Thursday, Mr Weatherill said he would "keep fighting".

"We keep campaigning, we demonstrate to him the effect that this will have not only on South Australia but on thenation," he said.

"If Holden leave it would create a massive hole in the South Australian economy.

"There will be a massive political price to pay for him (Abbott) if he turns his back on the car industry in this nation.

"We're going to have to get a change in position from the federal government at the highest level if we're to secure afuture for Holdens."

Victorian Minister for Manufacturing David Hodgett urged his federal counterparts not to speculate about Holden's futurein Australia.

"Any speculation on Holden's future is just that, and is not helpful," Mr Hodgett said.

"If you look at how much money Holden has received over a period of time, they pay the same amount back in payrolltax."

Mr Hodgett said the industry faced significant challenges but the Victorian Government would continue to put forward astrong case for government assistance.

"We believe there is bright future for Victoria and will continue to advocate and lobby as strongly as possible forcontinued government assistance," he said.

Victorian Opposition Leader Daniel Andrews called on Premier Denis Napthine to "fight hard for these jobs".

"These jobs are worth saving, the challenge is whether Denis Napthine is prepared to do the work necessary to makesure we've got a vibrant auto industry for decades to come," Mr Andrews said.

Greens MP Adam Bandt said it was imperative the auto giant survived.

He said it was vital they moved into manufacturing electric cars and had the right incentives from government to staylocal.

"Tony Abbott does need to step up and secure the industry's future," Mr Bandt said.

Mr Bandt said the carbon tax had not had a negative impact on the sector and using that as an excuse was a cop out.

"It is the government washing its hands of the fact that they might be about to see Australia entering into recession," hesaid.

"You'd have to think that if 50,000 jobs over the next couple of years might go and if the government is planning massivecuts then Tony Abbott and Joe Hockey may be about to preside over a budget which could see Australia's economygo backwards.


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"Now is the time for government to step up and support industry and support public spending."

But Parliamentary secretary Steve Ciobo dismissed the suggestion as ''a very long bow to draw'', saying it wasn'tinevitable that Holden would go to the wall.

"We would welcome Holden clarifying their intent about what they'd like to see happen and where they believe the futureof manufacturing is in Australia,'' Mr Ciobo told reporters.

Opposition assistant treasurer Andrew Leigh said Australians want cars made locally as figures show taxpayers arecovering about $2500 of the cost of each vehicle.

He was responding to "concerning'' reports that Industry Minister Ian Macfarlane is the only cabinet minister in the

Abbott government backing more assistance for Holden.

"Australians would like to see cars being made here,'' Mr Leigh told ABC radio today.

And senior Opposition figure Penny Wong claims some Coalition government ministers are championing the closure ofHolden.

''But they're not brave enough to put their names to it,'' she told Sky News today.

Liberal senator Simon Birmingham welcomed the statement while rejecting Senator Wong's claims.

"Nobody in the government wants to see Holden close,'' he told Sky News.

Independent senator Nick Xenophon said Tony Abbott will not want to go down in history as the Prime Minister whopresided over the death of Australia's automotive industry.

"If you lose Holden, you end up having a collapse in the entire automotive supply chain,'' he told reporters in Canberra.

Dave Smith, the national secretary of the vehicle division at the Australian Manufacturing Workers' Union this morningsaid Tony Abbott would celebrate the closure of Holden and the Prime Minister wasn't serious about saving the industry.


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"He will be proud to be the Prime Minister that shut down this industry," Mr Smith told ABC Melbourne's Jon Faine.

"Champagne is on ice with these people... (Tony Abbott) will celebrate these job losses... they will be out therecelebrating.

Mr Smith slammed the Productivity Commission inquiry as a "sideshow" and said that ultimately Australian jobs shouldbe saved.

"It's just common sense (that) jobs are more important than some economist's theory," he said.

And the union's national secretary Paul Bastian warned tens of thousands of jobs and the "nursery" of Australianmanufacturing will be lost if the auto industry is allowed to falter.

"There's not a car on the Australian road that is not subsidised in one way or another by the government thatmanufactures it," Mr Bastian told the Nine Network.

"That's because it 's a global race for jobs because they're high skilled, high paying jobs."

Mr Bastian said there was a "very strong" case for keeping the car industry alive in Australia.

"There's far too many jobs here at risk," he said.

Holden's argument to Productivity Commission

It was Mr Devereux's first public appearance since the leak about a possible factory shutdown.

Even though Holdenlodged its submission more than a week ago, the company was invited to deliver its submission inperson at the Productivity Commission's headquarters in Collins Street, Melbourne.

90,000 jobs at risk in Australia if car manufacturing dies

Central to Holden's argument is its claim that it generated $32.7 billion of economic act ivity in Australia from 2001 to2012, including $21 billion paid to other businesses for goods and services.

During that period Holden received $1.8 billion in Federal funding, but says it "returned" $1.4 billion to the Government viathe PAYG income tax of its workers.

"If Holden did not manufacture in Australia, the economic activity derived from the foreign investment by GM would not goelsewhere in Australia," Holden's submission to the Productivity Commission says.

"In fact, it would be invested by GM in another country."
http://www.news.com.au/technology/design/jobs-and-8-billion-at-risk-if-car-manufacturing-ends/story-fnjwucvh-1226779198444http://www.pc.gov.au/http://en.wikipedia.org/wiki/Holden


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The Holden submission also provided a grim assessment of the sharp decline in the local production and export ofHolden cars.

The production peak of the Elizabeth factory of 165,000 cars in 2004 has been halved, with Holden on track to build just84,000 vehicles this year.

The biggest export year was 2008, when Holden shipped 56,000 cars, mostly to the US, when the Australian dollar wasworth $US0.84.

Exports have fallen sharply since the Australian dollar reached close to parity; just 13,000 cars were exported last year,about 16 per cent of Holden's local production.

At the start of his new role, Federal Industry Minister Ian Macfarlane said Holden must export at east 30 per cent of itslocal production in return for further government funding.

Also central to Holden's argument has been the "ripple effect" of job losses at Australian car parts suppliers, if Holdenwere to shut its factory.

However, a confidential report obtained by theAdelaide Advertiser found that the two new cars that Holden planned tobuild from 2016 to 2022 had a "significant reduction" in local content and instead would have more foreign parts.

The Productivity Commission is due to publish a preliminary report on the car manufacturing industry on December 20ahead of a final report on March 31.

In March 2012 Holden agreed to build two new cars from 2016 to 2022 after receiving a pledge for $275 million in Stateand Federal assistance.

But since Ford announced in May this year that it would close its Australian factories in 2016, Holden has lobbied for anincrease in funding because, it says, "market conditions have changed dramatically" since the March 2012 deal wassigned.

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This reporter is on Twitter: @JoshuaDowling

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SOURCE: http://www.news.com.au/technology/design/federal-government-cal ls-on-holden-boss-mike-devereux-to-give-australia -the-truth-about-its-

future/story-fnjwucvh-1226779214737

Holden comes to an end

CarsGuide Editor Paul Pottinger says it's inevitable that local

manufacturing comes to an end. Holden fanatics could look to the Ford

Holden gone?

Holden could be at the end of its Australian journey within 3 years,

amid increased speculation General Motors is about to pull the plug on
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Federal Government Calls on Holden Boss Mike Devereux to Give Australia the Truth About Its Future _ News.com