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Govt denies report GM to axe Holden car plants by 2016

The Federal Government says a report that General Motors in the US has already decided to close its Holden car manufacturing operations in Australia is untrue.

Industry Minister Ian Macfarlane last night that dismissed the ABC report that Holden would go by 2016. The report said its sources were other senior Coalition ministers.

"Consultations are continuing in good faith with Australian carmakers, the components industry and workers," a spokeswoman for the minister said.

"The Productivity Commission is continuing its work assessing the Australian automotive industry and will report to the Government. That process is unchanged and will continue."

The ABC report, attributed to senior ministers, last night said the American carmaker had decided to pull out of struggling operations in Australia and had planned to make the announcement this week.

"The ABC understands that Holden has made the decision to cease its Australian productions regardless of an assistance package," the report said.

It said the announcement was scheduled for this week, but had been put off until early next year. Holden workers take a summer break over the Christmas period.

Holden refused to comment on the speculation. However, News Corp Australia is aware that Holden has been debating whether, once a decision was made, to announce the shutdown to workers before or after Christmas.

South Australian Premier Jay Weatherill last night rang Mr Macfarlane and said he had been told Holden had denied the reports.

Mr Weatherill said Coalition ministers were "briefing against their own colleagues, exposing the deep divisions in the Liberal Party over the auto industry's future".

"It is now time for the Prime Minister to intervene because this cannot be allowed to continue. This ongoing speculation is incredibly damaging to Holden and to the workers," he said.

South Australian senator Nick Xenophon asked how much more we would pay in Centrelink payments than we are paying in industry assistance if Holden closes. "What the hell is going on? We need to know," he said. "I believe Ian Macfarlane,

I'm not sure I believe other ministers in Cabinet. The PM needs to back Ian Macfarlane as a master of urgency. This is not just about SA. This is about 50,000 jobs being lost."

News Corp Australia has been told there were rumours on the factory floor this week that Holden was going to announce the shutdown on December 20, the last day of work before the summer break and the same day the preliminary Productivity Commission report on the industry was due to be published.

It is understood there was concern about announcing the shutdown before the summer break because of the personal effect it could have on the workers and their families.

However, historically, car companies have tended to share the grim news with employees soon after a decision has been made. When Ford announced the 2016 closure of its Australian operations in May, it did so less than a week after the decision was made to prevent any leaks to the media.

A 2016 closure would coincide with the timing of the end of the new Commodore's current lifecycle. However a secret SA Government document prepared in August floated the idea of a 2018 shutdown by extending the life of the current Cruze and Commodore.

Holden yesterday confirmed boss Mike Devereux was staying on in the role until next February. Mr Devereux was supposed to finish up this month after being promoted to a senior international role with General Motors, based in China. Mr Devereux made a surprise visit to the Elizabeth Holden factory yesterday to address workers.

Australian Manufacturing Workers Union SA secretary John Camillo said Mr Devereux did not tell them when a decision about the carmaker's future in SA will be made. "He never went to the situation of whether a decision is going to be made before or after Christmas but he did indicate that (Holden's parent company) General Motors will make that decision," Mr Camillo said.

- with Lauren Novak

This reporter is on Twitter: @JoshuaDowling


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