Holden to stop making cars in Australia

Fresh from the news that General Motors (GM) will be pulling its Chevrolet brand out of mainstream markets in Europe, the automotive giant has now confirmed that its Australian subsidiary, Holden, will stop making cars Down Under by the end of 2017.

It’s further bad news for GM, but even more so for the 2,900 Australian people who are set to lose their jobs as a result of the closure. And it’s a sad and disappointing end for the famous Holden marque, which can trace its history back as far as 1856.

On Bing: see pictures of Holden cars

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It was founded as a saddlery maker by British immigrant, James Holden, before moving into the automotive field in 1908. Having become a subsidiary of GM in 1931, the company was renamed as General Motors Holden Ltd, before latterly returning to its original Holden name.

The Holden brand has a proud history in Australia, but has been struggling since the 1970s. But that won’t make this week’s news any less painful.

A failure to exploit a sustainable export market and inability to tackle the threat of Japanese manufacturers has resulted in Holden’s rapid downturn in profitability.

For the past decade, Toyota has been the best-selling marque in Australia, with the Mazda 3 further rubbing salt in Holden’s wounds when, in 2011, it became the top-selling model, toppling the mighty Commodore in the process.

For many years Holden – much like the rest of the Australian automotive industry – has relied on government support just to survive. But according to the Australian Broadcasting Corporation (ABC), the Prime Minister, Tony Abbott has declared there would be no more taxpayer assistance.

With Ford ceasing production in 2016 and Holden shutting down a year later, Australia is left facing the prospect of having Toyota as the only company making cars in the country. Sad and worrying news for the economy.

But there could be worse to come. According to Dave Smith, national secretary of the vehicle division at the Australian Manufacturing Workers Union, there’s no guarantee that Toyota will stay in Australia, claiming it was ‘highly likely’ that the Japanese giant would go.

Smith said:

“In fact, it’s almost certain and this will spell the end of 50,000 automotive jobs. There’s no dispute about that.”

It’s been a tough few weeks for General Motors, with the Chevrolet and Holden news coming at a time when the US firm announced it is to sell its 7% stake in Peugeot-Citroen (PSA).

By offloading all 24.8 million shares to institutional investors, GM is set to lose around $39 million (£23.9 million) from the deal. The firm bought the shares in March 2012 for $402 million (£246 million) with a view to developing a car-building and purchasing alliance.

Is this the end for Holden?

Mind-bending car art

On Bing: see pictures of Holden cars

Find out how much a used Holden costs on Auto Trader

By motoringresearch.com