Holden needs to incrase productivity to make it in Australia

Posted on Friday, 21 June 2013 , 13:06:16 byEmil

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Holden needs to incrase productivity to make it in Australia

It has been a rough announcement the fact that Ford will close both its plants in Australia in 2016. The big concern now is that General motors Might do the same and together with it Holden will stop being produced there as well. So it seems that the Australian automotive industry has been hit hard now. Unfortunately there is no way of telling what will happen with Holden now, but the hope is it will not follow Ford. The reason for all this chaos is a very easy one: the cost of manufacturing cars in Australia is too high all because of a combination of factors including a strengthening of the local currency, their geographical position that makes sourcing parts more difficult and also the high wages. According to GM, they spend AU$3.750 more for every car they make in the country and most of them are included in the pay of the workers. Chairman and Managing Director Mike Devereux agrees that their geographical isolation, the cost of sourcing local components and their high labor rates mean that they pay a significant premium to manufacture cars here compared to importing. The Australian factory is more expensive than, for example, Germany, the UK, Spain and not to mention Asia. Over the last 12 years, Holden managed to bring $32.7 billion into the Australian Economy while in the same time they have received $18 billion in aid from the Government. For example, last month they posted losses in excess of $150 million. This is clear proof that the situation is not really that great. Very soon the discussions will start with the union regarding ways of cutting costs and also to increase the productivity and generally make the whole business a profitable one. The whole point of the meetings is to find the best solution and maybe find a way to keep them in Australia until 2022. These are all the details available on the situation for the moment, but will get back to you with more as soon as the company will offer us some more insights.


Holden needs to incrase productivity to make it in Australia image Holden needs to incrase productivity to make it in Australia image
Holden needs to incrase productivity to make it in Australia image Holden needs to incrase productivity to make it in Australia image
Holden needs to incrase productivity to make it in Australia image Holden needs to incrase productivity to make it in Australia image