US car giant General Motors has written to the Federal Government outlining what it claims is the true number of job losses in Holden showrooms across Australia – just days after all 185 dealers united to appoint a high powered law firm to represent them in negotiations over compensation.
The letter to all federal members and senators, a copy of which was obtained by CarAdvice, estimates about 650 showroom employees will be affected by the Holden shutdown – significantly less than the figure of 9000 provided by dealers when all aspects of their businesses are included.
The leaked document, signed by interim chairman and managing director of Holden, Kristian Aquilina, says: “In 2019, dealers collectively reported to Holden that there were 400 new sales consultants, 157 new sales managers, 49 fleet sales consultants and 40 fleet managers dedicated to the Holden brand across the whole network of 185 dealers (which operate 203 showrooms).”
Based on these numbers, the potential job losses amount to 3.2 workers per showroom according to Holden’s figures, versus 44 potential job losses per showroom based on data supplied by dealers.
“There may be some impact on jobs at dealers but not anywhere near the exaggerated numbers we have seen reported,” says the Holden document.
However, a Holden dealer council representative, speaking on condition of anonymity over fears it could impact his negotiations with General Motors, said of Holden's lower job loss estimates: “These numbers are offensive and laughable.”
Although Holden showrooms will close by the end of this year, dealers will be allowed to continue to operate their service and parts departments for the remainder of their current franchise agreements which expire at the end of 2022.
However, representatives for the dealer group claim there will be a massive downturn in business as customers no longer feel compelled to service their cars within the Holden network, which they claim will likely lead to job losses beyond showrooms.
“The Holden shutdown affects our entire business, not only the sales department. We have genuine concerns about the knock-on effects in terms of job losses,” said the veteran Holden dealer.
Holden says its recent shift to five-year warranty and seven-year free servicing campaign will encourage customers to stay within the network.
The leaked document also claims only 10 per cent of its dealers are solely dependent on Holden for their income – and those outlets will receive more compensation compared to dealerships that sell multiple car brands. “That dependency has been considered in our compensation calculation, with an additional supplemental payment,” the Holden letter says.
For the majority of Holden dealers – the 90 per cent of showrooms that also sell other car brands – General Motors claims “redeployment of dealership staff is likely to occur in many cases, either at their same dealership location or other sites”.