Prime Minister demands clarity from Holden on manufacturing future

The ABC and The Australian both quote senior government ministers who claim the car maker has decided to wind up its local manufacturing operations, and was poised to announce its withdrawal from the industry this week before postponing the announcement.

Abbott told Radio 3AW he wants Holden to continue building cars in Australia and for the local industry to prosper, but insisted his government would provide no additional funding beyond what it promised heading into September’s federal election.

“We stand ready to make that support available,” Abbott said. “But there's not going to be any extra money over and above the generous support the taxpayers have been giving the motor industry for a long time.

“The message we are getting from Holden is that they are in two minds.

“I do wish Holden would clarify their intention because at the moment they have got everyone on tenterhooks.”

Holden declined to “respond to speculation” in a statement overnight, and says it will not comment on its future while its discussions with the government continue.

Meanwhile, shadow industry minister Kim Carr has condemned the “division and dysfunction” of the Coalition Government in the wake of the reports.

The former industry minister says the Opposition understands that “no decision has yet been made by GM Holden” about the future of its car making business, but says it remains “on a knife’s edge” because a number of senior government ministers claim the industry’s demise is inevitable and they are therefore “justified in doing nothing”.

“This is a factional fight within the Liberal Party between those that want to abandon Australian workers and the Australian automotive industry, and those that understand how important this industry is to the future of Australia,” Carr said.

“The Abbott Government is now speculating about itself in the media and revealing deep internal divisions in a desperate bid to find an alibi for its indolence.”

Carr questioned the government’s lack of urgency in holding talks with Holden’s parent company, General Motors, and called on the Prime Minister to act quickly while there was still time.

“Why has there been no mission to Detroit to talk to senior management at General Motors?

“The Coalition knows the timetable for a decision is urgent and has known this since before Christmas last year. These are international decisions about the roll out of new models that need to be made.

“This is a failure of the Abbott Government to face up to its responsibilities.

“There needs to be a serious intervention by the Prime Minister if this industry – and the 200,000 jobs and hundreds of businesses it supports – is to survive.”

Carr also criticised the government’s insistence on waiting for the completion of the Productivity Commission’s review into the Australian automotive manufacturing industry before signing off on any new co-investment deals with local car makers, insisting it will “likely be nothing more than a post-mortem” by the time of its March 31 release.

He said support for the automotive industry is “needed and warranted”.

“The fact is government co-investment in automotive delivers a return at a rate of 9:1,” Carr said.

“The $2.7 billion Labor invested in the industry saw $26 billion in new investment.

“The reality is it will cost taxpayers many times more to let this industry fail than it will to support it.

“If the Abbott Government brings about the death of the automotive industry it would slash $21.5 billion from the economy.”