Australian car manufacturing ends as GM Holden closes plant
In this article (5)
Australia’s near 100-year automotive industry ended on Friday as GM Holden, a unit of U.S. carmaker General, closed its plant in South Australia to move manufacturing to cheaper locations.
The closure comes a year after Toyota and Ford similarly moved out, eliminating thousands of manufacturing jobs. It adds pressure on the government to help those made redundant find work in a battleground state ahead of a federal election in 18 months.
“The end of Holden making cars in Australia is a very sad day for the workers and for every Australian. It is the end of an era,” Prime Minister Malcolm Turnbull told reporters at a regular briefing on Friday. “Everyone has a Holden story.”
Turnbull has sought to soften the impact of a declining automotive industry in a state which historically determines who forms government by making South Australia a defense industry hub.
The government plans to increase defense spending by nearly A$30 billion ($23.52 billion) by 2022, with the manufacture of a fleet of frigates, armored personnel carriers and submarines to be concentrated in South Australia.
But John Camillo, state secretary at Australian Manufacturing Workers’ Union in South Australia, said nearly 2,500 newly unemployed will need government help finding work.
“They need to be retrained to be able to work in defense, mining, aerospace, because we are going to be building ships,” Camillo told reporters outside the GM Holden plant in Elizabeth, 26 kilometers (16.1 miles) north of state capital Adelaide.
Camillo was joined outside the factory by hundreds of workers and car enthusiasts who had gathered to greet the last car off the production line.
“A BEAUTY”
“But John Camillo, state secretary at Australian Manufacturing Workers’ Union in South Australia, said nearly 2,500 newly unemployed will need government help finding work.”
Rising discretionary income and record-low interest rates have encouraged consumers to buy new cars, but many turned against the large passenger cars for which GM Holden is known.
“Consumers want fuel-efficient small cars and sports utility vehicles (SUVs), and overseas manufacturers have been able to profit from changing tastes,” William McGregor, industry analyst at IBISWorld, told.
Monthly SUV sales hit a record in June, surpassing 40,000 cars, Bureau of Statistics data showed.
GM Holden, whose SUV range proved unpopular with Australians, will shift production to Germany where advanced automation will help keep costs low as it revamps its lineup.
GM Holden began auto production in 1948 with then-Prime Minister Ben Chifley driving the first car off the production line, declaring it “a beauty”.
“I have bought four of them,” said Shane Oliver, an AMP Capital economist who described the closure as a “sad day”.
“But it’s clear that not enough Australians’ agreed, opting for foreign-made SUVs instead.”
Questions & Answers
Q.Which other car manufacturers have ceased production in Australia recently?
Which other car manufacturers have ceased production in Australia recently?
Toyota and Ford similarly moved out of Australia a year prior to GM Holden's closure. Their departures also resulted in the elimination of thousands of manufacturing jobs in the country.
Q.What is the Australian government's plan to help those made redundant find new work?
What is the Australian government's plan to help those made redundant find new work?
The government intends to make South Australia a defence industry hub. They plan to increase defence spending, concentrating the manufacture of frigates, armoured personnel carriers, and submarines in the state.
Q.Why did Australian consumers turn away from GM Holden cars?
Why did Australian consumers turn away from GM Holden cars?
Consumers' tastes shifted towards fuel-efficient small cars and sports utility vehicles (SUVs). GM Holden was known for large passenger cars, and their SUV range proved unpopular with Australian buyers.
Q.Where will GM Holden's car production be relocated after the closure in Australia?
Where will GM Holden's car production be relocated after the closure in Australia?
GM Holden will shift its production to Germany. This move aims to keep costs low through advanced automation as the company revamps its product lineup.
Reader pulse
Is Holden's departure good for retail diversity?
17,554 votes so far