Holden says it will build two all-new cars in Australia in the second half of the decade after confirming it has secured a $275 million co-investment package with federal and state government.
The local car maker has confirmed the new models will be based on global models and share platforms from within parent company General Motors, placing a question mark against the future of the Commodore large car that is limited to only small export numbers to the US and Middle East.
The local car maker has been seeking financial assistance since intensive discussions between parent company General Motors and representatives of the Gillard government at January’s Detroit motor show.
The company says it will commit $1 billion to the next-generation development and manufacturing program for the next 10 years.
“The two new Australian-made cars will be world class,” said Holden boss Mike Devereux in a statement. “They will be underpinned by global architectures from within General Motors and bring new fuel-saving, connectivity and safety technologies to Holden’s portfolio.
“The investment will help Australia retain its capability to design, engineer and build cars with two all-new vehicles going into production at Elizabeth, South Australia, in the second half of this decade.”
The announcement will again raise questions about government subsidies to the local car industry after Ford declared in January that it had secured the future of the locally built Falcon and Territory models only until 2016 after negotiating a $103 million co-investment deal with the federal and Victorian governments.
Toyota has only committed to local manufacturing until 2017 after announcing in January that it was axing 350 employees from its Altona plant where the Camry and Aurion models are built for both Australia and some export markets.
Holden argues the co-investment will reap dividends for Australia, claiming it will inject about $4 billion into the economy over the next decade based on its 10-year investment to build cars locally rather than import them.
Holden currently builds about 90,000 vehicles a year at its Elizabeth plant in South Australia, split between the Cruze small car and Commodore large car.
Read CarAdvice’s follow-up story: Holden’s future models: small car certain, large car questionable.