General Motors (GM) has pulled the plug on Holden after 160 years in Australia, shutting off the supply to right-hand-drive markets around the world which do not produce their own new vehicles.
As a result, Holden will stop operating in Australia and New Zealand by the end of the year, as will the GM design studio in Melbourne and the Lang Lang proving ground.
It is understood that up to 800 employees are at risk of losing their jobs.
In an official statement, GM says it “undertook a detailed analysis of the investment required for Holden to be competitive beyond the current generation of products”.
“Factors impacting the business case for further investment included the highly fragmented right-hand-drive markets, the economics to support growing the brand, and delivering an appropriate return on investment,” it said.
What this mean is that Holden is no longer a viable, profitable business for GM.
In an official statement, GM International operations senior vice-president Julian Blissett said: “After comprehensive assessment, we regret that we could not prioritise the investment required for Holden to be successful for the long term in Australia and New Zealand, over all other considerations we have globally.
“This decision is based on global priorities and does not reflect the hard work, talent and professionalism of the Holden team,” he said.
Meanwhile, GM Holden interim boss Kristian Aquilina said the brand will work towards a dignified wind down of operations.
“Unfortunately, all the hard work and talent of the Holden family, the support of our parent company GM and the passion of our local supporters have not been enough to overcome our challenges,” he said.
“We understand the impact of this decision on our people, our customers, our dealers and our partners – and will work closely with all stakeholders to deliver a dignified and respectful transition.”
Holden says all existing warranties and customer support will be honoured, while spare parts and service items will be stocked for at least 10 years.
Holden says it “will work with its dealer network on appropriate transition arrangements” and that “employees will be provided separation packages and employment transition support”.
With Holden pulling out of the market by the end of 2020, the Lion brand survived just three years after the cessation of local manufacturing and the Aussie-built Commodore.
Since the closure of local manufacturing, Holden has struggled to find its footing, dropping to 10th position last year with 43,176 units, a year-on-year drop of 28.9 per cent.