No guarantees in life, says Holden boss

GM Holden chairman and managing director Mike Devereux announces that 400 jobs will go at Holden's Elizabeth plant. Picture: Tait Schmaal Source: adelaidenow

THE boss of Holden, Mike Devereux, said he would resist any move to guarantee jobs in return for future taxpayer funding - a move which could put the company on a collision course if there is a change in Federal Government at the next election.

The comments come one day after News Limited revealed that Holden did not guarantee one job in return for the $2.17 billion in taxpayer dollars pledged to it over the past 12 years.

"I think it's quite a difficult thing to do (to guarantee jobs) and it's highly unlikely," Mr Devereux told News Limited.

"The current approach, and quite frankly the approach of past governments both Liberal and Labor, has been to not restrict the commercial decisions of the company.

"Our current agreement with the federal government does not include minimum employment levels. (The assistance) is designed to generate the capacity to build things ... and jobs flow from that."

"There are no guarantees in life," Mr Devereux said."I don't know how many cars Australians will buy in 2016."

Holden yesterday announced it would axe 500 jobs - it's biggest redundancy program since the GFC - and the supplier industry today said job losses would likely follow in its sector as well.

Sophie Mirabella, the federal shadow minister for industry, told News Limited that jobs guarantees should be part of any future government assistance packages to the car industry.

"I think the car industry can survive [but] there needs to be different guidelines and benchmarks. Obviously the issue of jobs needs to be part of the revised guidelines for funding," Ms Mirabella said.

"The South Australian Premier, Jay Weatherill, did a handshake deal to secure jobs (at Holden) for $50 million. What did the Federal Government ask for in return for a $215 million grant? There was obviously no commitment around the workforce.
 
"This current situation highlights the problem when there are individual ad-hoc deals done behind closed doors," Ms Mirabella said.

"Clearly the current government policies haven’t worked … because we’ve seen thousands of workers lose their jobs."

According to the latest Census data about 42,000 workers are directly employed by about 150 automotive suppliers that provide Holden, Ford and Toyota with the parts to build cars, including instruments, panels, bumper bars, glass, seats, rubber seals and steering wheels.
 
But 92,000 workers have lost their jobs in the manufacturing sector in the past five years, according to federal employment figures.
 

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Little Holden punches above its weight

The new Holden Cruze. Source: Supplied

HOLDEN has revealed its cheapest homemade model in 21 years, a $19,490 remake of its Cruze small car.

On sale in the first week of April, the Adelaide-made sedan or hatchback is priced under its closest rivals by $500 to $1000, but has more equipment.

In relative terms, the $19,490 price tag is the smallest ask ever for an Australian-made Holden.

The extensively reworked 2013 Cruze sedan or hatch has standard fittings that are rare among even modern small cars, especially bargain price models. These include a 7-inch touchscreen multimedia system with Pandora streaming music and 17-inch alloy wheels. It also has a five-star crash safety rating, with six airbags.

The new Cruze is cheaper than its competitors, but has more equipment.

The previous cheapest Holden was the Nova hatchback, a copy of a basic Toyota Corolla. The Nova was priced at $17,200, increasing to $20,748 in 1993.

This old Corolla clone boasted an AM/FM radio with cassette player, a weak 1.4-litre engine and no safety equipment beyond seatbelts and basic brakes.

The new Toyota Corolla and Nissan Pulsar start from $19,990. The best-selling Mazda3 is priced from $20,330. The Mazda and Toyota outsold the Cruze by as much as 1500 units on February. The Pulsar, returning after a six year absence, sold 1275 cars to the Cruze's 1729.

The new Cruze comes in sedan or hatch variants.

The Cruze is the first stage of Holden's fightback after its worst month for seven years, one in which they were the first time beaten by these three Japanese brands.

All Cruze variants are reduced in price, some by as much as $3000, but now have a full range of equipment. The new SRi variant, which uses a powerful turbo engine from Europe, starts at $22,490. The Cruze will get satellite navigation in June when the new system that is being developed concurrently for the VF Commodore comes online.

Holden chief executive Mike Devereux said the Cruze is now the cheapest but best equipped model in the small car segment, which last year saw 252,000 sales.

Philip King reviews the latest and greatest cars on show at this week's Geneva Motor Show.

Holden engineers said they were given a "clean slate" to improve the small car which was originally imported from Korea before local manufacture commenced in March 2011.

Mr Devereux said more than 53,000 Cruzes have sold in those two years despite it having "not been spectacularly well reviewed".

He said the Cruze was now a "Holden".

"Local calibrations are a big deal," Mr Devereux said. "It's done here by people who drive here. It has to be an advantage."

Matt Hobbs, Holden's director of corporate affairs, said the Australian production of the Cruze was made possible by government investment. But the 18-month engineering program to update it was completed through Holden's own funds.

"We reinvested our profits directly in this localisation work," Mr Hobbs said. "But without the assistance we would have no manufacturing at all."

The next and most-hyped stage of Holden's fightback, the Commodore large car, debuts mid-year. It is expected to be the last car of its type made here and a racing variant has already found success in the United States, which is taking small-volume exports.

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