Holden Cruze: local production of next-generation small car confirmed

The company has previously revealed it will produce two models at its Elizabeth plant in South Australia starting in the second half of this decade, but had not previously disclosed their identity.

Speaking at today’s Australian International Motor Show, Holden president Mike Devereux confirmed the Cruze is one of the two vehicles that has been assured a long-term future.

“I’ve been on the record to say we would be pretty stupid not to build a small car given how big that segment is,” Devereux said.

“We will be building the global Delta [Cruze] in our next-generation product line and we have yet to announce what that second line up is.”

Despite a series of questions, Devereux would not be drawn on the identity of the second car.

“I wasn’t even supposed to say what the first one was, but it was obvious we would be stupid not to build it.”

Devereux did confirm the company has locked in its decision.

“We obviously know what that second vehicle is going to be, we’re just not going to tell you,” he said.

Devereux did confirm the second car would not be the mid-sized Malibu sedan that will be slotted into the line-up just below Commodore next year.

When asked whether a Captiva-style SUV would be the best bet, Devereux appeared to suggest it was not likely.

“In order for us to make the Adelaide plant work economically, we have to pick two top 10 selling vehicles, there is no room for error,” he said.

“You have got to sell 1800 to 2000 cars every single month and when you talk about SUVs, and I’m not ruling it out, but the top selling SUV is the Mazda CX-5 at 1850 units in one of their best months. That is the best selling SUV. So, if you knocked it out of the park and made the best selling SUV in the country, four or five years ago from now, I imagine that would be 1800-1900 units.”

Devereux’s logic seems to suggest a larger car, possibly Commodore, might get the green light for long-term local production because it has less rivals than other contenders.

“The market has a lot of fragments, you have 80 SUV competitors, 40 small car competitors and 20 large car competitors, all told, luxury and non luxury. So, the more you have to compete with, the more risk there is to be able to get that 1500, 1800, 1900 [sales per month],” he said.

When asked specifically whether a large car like the Commodore could continue to sell in large volumes in several year’s time even though buyers are tending to move away from such cars, Devereux said:

“I think VF will answer a lot of those questions,” he said.

The VF Commodore is expected to run through to 2018.

Holden didn’t present any Commodores during the media presentation at the Sydney show, instead focusing on the Captiva 7 SUV, Cruze wagon and Malibu mid-sized sedan.

It says there will be much more attention given to the Commodore next year, with the arrival of the VF set for mid-year and a US export program set to kick off around the same time with a V8 model to be sold as a Chevrolet SS. The styling of the Chevrolet-badged model will be showcased for the first time when the body shell design is featured on the Chevrolet NASCARs that will be revealed at the Daytona 500 in February.

The next-generation Cruze is expected to be introduced globally in 2015, with Australian production expected to start in the same year. Holden is just about to begin work to prepare its production facility for the new model.

Devereux would not be drawn on whether there were any export plans for the Australian-made Cruze.

“I wouldn’t rule out anything but it would have a lot to do with the economic situation in relation to the dollar five years from now. A 70c dollar changes the whole equation and I can’t predict what the dollar is going to be in five years,” he said.