GM Holden – FAQs
June 2, 2009 by David Twomey
GM Holden issued a list of Frequently Asked Questions to today’s media conference on its future.
While it definitely seeks to put the company spin on the whole saga we thought some of our readers may be interested in reading through GM Holden’s answers to its own questions.
Frequently Asked Questions – Holden
How is Holden affected by this filing?
Holden is not directly included in or impacted by the US court proceedings.
Does this mean Holden is going out of business?
No. None of GM’s operations outside of the US are included in the US court filings or court- supervised process, and these filings have no direct impact on GM’s plans and operations outside the US.
But doesn’t bankruptcy mean the end of a company?
Chapter 11 in the US is not like Australian law. It is a highly structured, court-controlled process that allows companies to continue trading while they reinvent their operations. Unlike the systems of many other countries, the US chapter 11 process is focused on the preservation and reinvention of a company’s business. It does not mean ceasing to trade.
What happens to Holden once New GM emerges from chapter 11?
Holden will be an important part of the New GM. We will maintain our focus on product programs and activities. That means technology improvements to our best-selling Commodore range, launching the all-new Holden Cruze and the introduction of our locally built fuel efficient, four-cylinder small car next year.
What happens to Holden’s operations during GM’s chapter 11 process?
Holden continues to run full operations at Elizabeth and Port Melbourne, producing cars for our 300- strong independent dealer network. We don’t anticipate this US action will have any direct impact on our local workforce, dealers or Holden suppliers.
Will there be any impact on your workforce?
We don’t anticipate this decision will have any direct impact on our workforce, dealers or Holden’s suppliers. Employee pay and benefits will continue. Any decisions related to Holden’s staff would be made by Holden, not as the result of any overseas action.
Are your dealers affected?
Holden dealers, warranty and customer support operations are unaffected by the US filing.
Will financial institutions continue to provide credit to Holden dealers to finance sales in Australia and New Zealand?
We do not foresee any interruption with regards to dealer or retail financing.
What happens to Holden customer warranties?
Holden warranties are not affected by this announcement.
Does GM’s announcement put a stop to any Holden projects?
No. We continue our development work on fuel-saving technologies and future models. Work has already commenced preparing our Elizabeth plant to build our all-new, fuel-efficient, four-cylinder small car. The project remains on track with production to commence in the third quarter of 2010. Our funding and capital for that project is locked in. We have also just launched the new Cruze and continue developing future models of Australia’s top- selling car, the Commodore.
Will Holden’s suppliers get paid as a result of this decision?
Holden supplier payments remain unchanged.
If Holden is not directly impacted by this decision, why are you issuing statements about it?
We wouldn’t normally issue statements to highlight that nothing has changed, but we appreciate that customers will naturally ask questions about this sort of action in the US.
Do Holden operations have access to its technology patents even though GM had filed for chapter 11?
Despite the filing, GM Asia Pacific – and that includes Holden – will have continued access not only to the intellectual property developed in AP, but also to the intellectual property developed elsewhere in the new global GM organisation.
What will happen to Holden’s management team? Will it remain in place?
We do not foresee any changes to Holden’s management.
What is chapter 11?
Chapter 11 refers to the provisions of chapter 11 of the US Bankruptcy Code that allow a company to pursue a court-supervised process to address its financial challenges while continuing to trade.
Unlike the laws in many other countries, the chapter 11 process is focused on the preservation and reinvention of businesses.
What is a section 363 filing?
GM is using section 363 to transfer assets to New GM and enable it to quickly emerge from chapter 11 as a leaner, stronger company. It is a commonly used and proven provision of the US Bankruptcy Code.
What does GM hope to accomplish via the 363 sale?
‘363’ is a proven process that will allow New GM to emerge a leaner business with a significantly stronger balance sheet, a world-class product lineup, a global footprint and industry leading expertise and technology. Many major US companies have successfully used the 363 process.
Why did GM file for chapter 11?
In the US GM reached important agreements with key stakeholders that will significantly reduce its debt and strengthen its capital structure, and help accelerate its reinvention. To implement these vital agreements, GM is using an expedited court supervised process under chapter 11. With the support of the US Government, the UAW, other key stakeholders and with safeguards for customers and suppliers, the section 363 process will enable GM to accelerate the sale of its strongest brands and operations to the New GM which will emerge a lean, profitable, self-sustaining company.
Does this mean GM is going out of business?
No. GM is reinventing its business, not going out of business. Its operations will continue as normal during the chapter 11 process, which should take about 60-90 days.
Does this filing impact GM’s operations/subsidiaries outside of the US?
GM’s subsidiaries outside the US are not included in the filing. There are no legal changes to the way GM conducts business in Asia Pacific, including Holden, as GM’s operating entities in AP are not US based companies.
Why did GM choose the 363 process over a pre-packaged chapter 11?
The US Government and GM believe the tools made available through the 363 process will enable GM to accelerate its rebuilding process. ‘363’ is a process that will allow New GM to emerge as a leaner company with a significantly stronger balance sheet, a world-class product lineup, a global footprint and industry leading expertise and technology.
Section 363 allows a company to sell assets quickly in an orderly fashion, and GM will be seeking the Court’s approval to complete the sale so as to ensure that New GM has a stronger balance sheet.
The assets sold do not remain part of the original company and are no longer included in the chapter 11 filing. Many major US companies have successfully restructured using the 363 process, including:
– Continental Airlines
– Delta Air Lines
– Federated Department Stores (parent of Bloomingdale’s and Macy’s)
– Kmart
– Toys R’ Us
Print it: 
Im sure that still wont keep the HHH {Holden Haters Happy}
My main questions is regarding the LS engines and if they will be affected. Holden’s V8 engines are manufactured by GM factories, if they look to a cleaner more efficient future how can this include a big V8? Also, has operations stopped at this factory? I know GM Powertrain who manufacture a number of GM’s gearboxes are in the process of winding up by 2010.
Does anyone know if the LS engines will still be supplied to Holden or if these factories will continue to operate.
Wasn’t going to comment but the ads by Google at the side bar were all about getting consultancy and help before declaring!! (LOL) perhaps GM should have looked at car advise first :p
I am not a Holden fan, but I get no pleasure from what GM are going through and the jobs that will be lost.
Times are a changing Shane we are in the last phase of the golden age of the internal combustion engine. Soon we’ll be talking volts not V8’s and range instead of kilometres per Litre.
Its not very informative, as expected.
Holden’s future might still be part of the new “GM”. But this FAQ or any other “public” FAQ answer the important questions.
Only within the company or the internal staff can provide with those answers. Example, redundancy pay-outs to Holden staff, I have a friend who is in the know how and confirmed they are offering many redundancy packages. Also projects will be postponed or cancelled, you cannot continue with projects (still in its planning stages), not knowing if the funding will still be there nor the need, due to the re-structuring… as US government will control the money where GM puts it in.
So does that mean no more sh*t cars built in the US from General Motors?
May i ask something: Reuss said that they are building a new small car next year which is not the cruze but CA said that Holden will be building the Cruze from next year which is it ??? Really beacuse this has been going on for a while.
Shak
Reuss has been on record for many months that the “new” small car built at Elizabeth will be the Cruze. It’s only holdout hopefulls on here that keep denying it (why? Don’t they want Holden to build a Daewoo here to save the company?)
It will however be a “slightly” different model to that imported – read “hatch” not sedan.
Astro, totally agreed, not sure if im ready to say goodbye to the internal combustion motor though. I guess my queries regarding the supply of V8 motors to Holden is more of a now concern. If GM Powertrain and GM Performance Build Centers close which is speculated by 2010 for GMPT, kiss the Holden SS good bye. The US may keep the 4 and 6 cylinder operations going with a small V8 line for the pickups, however I think the contract with Holden will not suffice keeping a factory going in the US for large capacity engines.
If any of you think the LS engine is going to be going anywere soon your morons, the Corvette program is confirmed and the new Camaro is selling like hotcakes….
The US governnment may be forcing GM to make competitive entry level cars, but they arnt going to force it to remove its core competencies.
Just a couple of questions here from a Ford guy
1. Who the hell is Holdens PR guy and why cant Ford have them
2 Why is it that the hard working companies not asking for billions will be the big loser in all this while the company already borrowing billions start clean slate.
3. Can Holden every do anything wrong, every website has some sort of positive spin on this… always has
Why isn’t Ford making a move on this – this should be a massive opportunity to build confidence in their product, yet Holden always comes up trumps.
Awww shucks, don’t cry Drw009, it’s just the way of the world.
Everyone hates Fords and loves Holdens, deep down you knew that already, didn’t ya :)
GreaseMonkey LOL.!
But Drw009 you’re 100% right.!
Forgot ya Tom
Camaro/Corvette/Hummer/Pontiac/Caddilac and all their “pretend” performance brands is exactly one of the main reasons G.M is BROKE.
G.M has been in this pretend world for to long, NOT really seeing what trends have been happening and now they are right in the CACTUS.
shak,
my mail is the holden WILL make cruse next year,the robots are in allready,and there looking at putting an independent rear in it.
one more thing about cruze.its solid.a full 140kgs heavier than astra(my pick of solid small car)holden arn’t going to market it as a sports car,just solid value a to b motoring,after all,its market is now twice as big as commodore…
“Mark Reuss confirmed yesterday…The hatch will be built alongside the Cruze sedan at Holden’s Elizabeth plant”
Like I’ve been saying for months, and sorry, but “I told ya so!”
“Reuss says the hatch version of the car “is going to be done entirely in Australia”".
Easy to say that when it’s already done. This is just spin to shore up public support by saying “Oh look at what we’re gong to be doing” when, in reality the work is done, and the contractors have already left the building.
Sorry Wheelnut, but I’ve saying it for a while now….
CRUZE – Daewoo designed, Australian built.
Don’t be too bluffed by the Australin input either, all we did was the hatch. A$600M vs US$4.2 Billion.
You would be an absolute bloody idiot to put your money on the line and buy a new GM Holden now.
It’s not rocket science is it..
The car Holden will build in South Australia, and the plant has already been cleared of the old line and the new equipment is going in now, will be a car based on the same Delta 2 platform as the Cruze. Will it be called Cruze, probably, and it will almost certainly be a hatchback and a coupe to add to the sedan, which is imported from Korea. It will all replace the Astra range, which if sold here again will become a premium/sporty model.
David, the sad reality is that with GM’s decisions now being controlled by the US Government and Courts that could all change at any tick of the clock.
“Im sure that still wont keep the HHH {Holden Haters Happy}”
Come on Bav, if Holden totally disappeared where would I get most of my material? I’m doing a run of 1000 HHH T-shirts if your interested :)
This is a good result for the employees of Holden not to mention the local Vic enconomy. Best of all its kind of over and we can now get back to our normal routine of bashing local/Euro & US Car manufactures.
“Sorry Wheelnut, but I’ve saying it for a while now….
CRUZE – Daewoo designed, Australian built”
Personally I agree Bret, but it does also raise the question of what will HSV do with the cruze if anything considering the Astra is now a gonna, and on the back of what Astro boy said.
DavidT.
An inside source tells me the Elizabeth built car is NOT on the delta 2 platform? IF, it is built in Australia at all.
“An inside source tells me the Elizabeth built car is NOT on the delta 2 platform?”
Yeah its built on Platform 2, Flinders street station :)
Surely the Delta 2 Platform would make the most sense, that would cover them for the cruze/volt & shock horror maybe the new astra. Could that be why its off the import list ooohhhhh….
TS, Check your sources. They’re wrong. Or maybe it’s just more of the spin by some to distance GMH from the Daewoo design?
Can conferm if GM Holden dont get the numbers from Cruise we wont see it built in Oz. Will check source on platform.
TS, my information is that it IS Delta II, but don’t forget that there are variations. Maybe your source is confused by the IRS.
And BTW if Cruze doesn’t make the numbers then GM manufacturing in Australia goes with it. The business case is based upon success of both large and small cars.
All is good and well as far as this pretend bankruptcy is concerned but what about the creditors that will never see a cent of their money repaid or maybe 10 cents in the dollar at best?
Can’t help but think that this pretend type of bankruptcy is going to bite the rest of us on the Rs with other investments soon.
Otherwise wish GMH all the best.
If the numbers for the Cruze don’t work out….don’t rule out the possibility of Holden building the Insignia..
as under the new ownership agreement in relation Opel GM still have a 35% share which means they can still share technology etc which means it could still happen.
As I have said before; The Cruze [which is based on the Astras Delta II platform] is being built in so many other Factories around the world so supply is more than abundant whereas the Insignia [based on the Epsillion platform] is only being built in Russelsheim Germany.
Therefore; given that the Insignia is going to be a very popular model if Holden ended up building the Insignia it would help ease the workload in Germany as well as help Opel meet demand for by exporting it to Europe and the USA
I can’t see the point in having yet another factory [Holden] building exactly the same car as 4-5 other factories are already; as you then end up with factories opperating at 50-60% instead of 80-90%.. and is one of the reasons GM is in so much trouble 1-2 should be enough.
Wheelnut,
- How many other factories will be building the Cruze hatch?
I’m not aware of any.
- Factory capacity is the very reason that Holden will build Cruze here. They need it for the factory capacity/efficiency effect. Same over at Ford, it’s all about keeping the plants up to a certain volume.
- Insignia is NOT part of Holden’s projected model line-up so it has to build a car that it intends to sell – it’s Commodore/Cruze or nothing.