GMH needs funding to stay in OZ

[dmacey]

Found this info also,

Prime Minister Julia Gillard announced the scrapping of the Green Car Innovation Fund back in January to allow the Government to contribute to rebuilding efforts due to the Queensland floods. With the scheme now revived, and with cash-strapped GM reluctant to splurge on engineering projects, Holden is no doubt glad that it has secured the funds to help engineer VF. The $39.8 million government grant announced today is in addition to the $149 million the company received to build the Cruze small car in Australia.

This was 19th May 2011,

[VZ Thunder SS]

The vf looked alot like the VE, Just a bit more tough looking.

[Reaper]

The vf looked alot like the VE, Just a bit more tough looking.

You have seen one???

Reaper

[greenacc]

What 's gone so wrong with the automotive industry that means all the manufacuters need handouts to stay in business ?
Sounds a bit like Armerican farmers subsidies.

[Reaper]

What 's gone so wrong with the automotive industry that means all the manufacuters need handouts to stay in business ?
Sounds a bit like Armerican farmers subsidies.

For Australia the high value of the $ plays a big part. Overall Auto assembly is a massive employer for wherever it sets up and thus various states/countries and even cities will essentially bid to get the plants set up there. It is not only for Automotive, most big business that employs a lot of people enjoy similar tax breaks/subsidies. This has been going on for nearly as long as there has been a car industry world wide.

Reaper

[c2105026]

Here is a thought; what is the difference between handouts to car companies and like those the american banks at the peak of the GFC? Do more profitable companies like BMW and Toyota get similar assistance I wonder?

[exec24]

The vf looked alot like the VE, Just a bit more tough looking.

from what i've been told it's the same roof and floorpan as VE, everything else is new

I've also been told holden will be axing jobs(Casual and Contract work) within the next few weeks

also Mitsubishi (at Tonsley park) got a Government handout, look where there are now....

[Reaper]

Here is a thought; what is the difference between handouts to car companies and like those the american banks at the peak of the GFC?

The US government took an ownership stake of the banks (and GM) during the GFC. In theory that stake could be sold into the future assuming it was worth something. The current injection of $$$ into the Australian car industry does not involve an equity stake.

Do more profitable companies like BMW and Toyota get similar assistance I wonder?

NFI about BMW but Toyota defiantly receive assistance to stay in Australia. Thailand government invested a huge amount to attract Toyota to set up there. Low wages and relatively (to Australia) lax environmental and OHS laws also helped.

from what i've been told it's the same roof and floorpan as VE, everything else is new

Most of the hard points remain. My information says think of a current Commodore with the next generation of Cruze styling. Look towards the Malibu for styling cue's too. Haven't heard but I'd be a amazed if the dash/centre console didn't get a substantial makeover too.

also Mitsubishi (at Tonsley park) got a Government handout, look where there are now....

Mitsubishi situation was worlds different to Holden.

Reaper

[immortality]

I haven't read the entire thread but can anybody confirm the future of the long wheel base models being built in Aussie?

My Neighbour works for a taxi company who almost exclusively use the Caprice model and the have been told that it's very likely that they won't be able to get any more in the future.

[Reaper]

I haven't read the entire thread but can anybody confirm the future of the long wheel base models being built in Aussie?

My Neighbour works for a taxi company who almost exclusively use the Caprice model and the have been told that it's very likely that they won't be able to get any more in the future.

Will be safe whilst they are still building Commodores here and still run the current platform.

Reaper

[exec24]

Most of the hard points remain. My information says think of a current Commodore with the next generation of Cruze styling. Look towards the Malibu for styling cue's too. Haven't heard but I'd be a amazed if the dash/centre console didn't get a substantial makeover too.


Mitsubishi situation was worlds different to Holden.

Reaper

Yeah, i've been told its Styled along the lines of the Cruze too, and only a few VF's have been built so far, and they would incorporated a lot of the cruze features, I was told that Holden's here in Elizabeth have a clause to stay here until 2020(im not sure why) but beyond that i've been told they will go overseas

[dmacey]

100m over 4 years for Toyota.

I feel sorry or these people.
for every 1 person employed by a Make, 9 people are in support industries, by applying that logic potentially 3150 more people will be without a job in the near future.

If i was in the auto sector I would see what else I could do and make a move asap. It is well beyond sustainable, and wont be supported forever.

[c2105026]

+1 dmacey

It seems from sales figures that families are not flocking to large rear wheel drive cars in Australia the way they did back in the 90s. For Holden and Ford to get handouts they should be making a concerted effort to build cars that people actually want. Building the Cruze here was a master stroke that could ultimately save GM here in the long run, as the non-enthusiast and export market for the Commodore and Falcon dry up. Ford OTOH...they were looking at building the focus, but, alas, that was canned. Falcon no longer in the top 10; would be interesting to see its figures. With a lack of export markets, I m doubtful that there will be a local RWD falcon in 2020.

Here's the other thing; the main thing that has saved GM in australia is....marketing. Look back to the late 70s/early 80s when Brocky was untouchable; atht e time GM performance arm was booming with the Torana A9X, HDT Commodore and so on, Ford had basically retired from motorsport via factory and marketing support and from 1981-1994 there were no falcon victories on the Mount. Ford stopped building the V8 just before the mid 1980s oil glut. So, most of the kids who grew up in the 1980s (like myself) exposed to GM performance vehicles now want commodores now as adults, and not falcons. 'Brand imprinting'is the word that springs to mind.

Another thing - fleets have abandoned big cars (largely). Apparently Hyundai i30 is the flavour of the month. This is due to fleets seeking to cut fuel costs and to improve environmental performance. Like, I have a friend who is a local ford dealer. Try and guess when was the last time hey stocked an XT? 3 years ago. Hardly sell any of them. In fact, today If you see a new commodore chances are it has a body kit and big wheels on it, be it special pack, SV6 or SS. I cannot remember the last time I saw a VE Omega with plastic wheeltrims, actually LOL....

[Reaper]

A few home truths about the australian car industry: Belted Radial: Australian Automotive Manufacturing Home Truths

Reaper

[dmacey]

Food for thought on taxes

It's rarely a matter of tens of thousands of dollars. The same model can cost more than double or even up to three times as much in Australia.

In the most rarefied air of the luxury-car atmosphere, Britons can buy a Rolls-Royce Phantom limousine for the equivalent of $450,000; American buyers can waft along in the stately sedan for $373,000. In Australia, the Phantom costs millionaires more than a million: $1,068,000, to be precise.

Porsche's iconic 911 sports car starts here at $223,000. In Japan, its price tag converts to $134,000. Britain, $107,000. The US, ''just'' $77,200 - cheaper than HSV's Commodore-based GTS.

When Holden exported its Commodore SS to the US as the Pontiac G8 GT, it cost about $30,000, roughly $15,000 less than it costs here. What, how is that possible?

Zeta platform was developed here,

LS engine foreign
Gearbox foreign
Suspension foreign
Head unit/ GPS/driver display foreign
Braking systems foreign

The engineers here homogenize it for local use. I'm not convinced that the funds they receive are showing a good ROI. Export for our local vehicles are drying up, Camry is a global car, the hybrid system was already in use OS, yet they received 100M to develop a hybrid in OZ.

Holden gets 100M+ to build the cruze, a car that was already being produced in other markets.

I am for funding, don't get me wrong, but look back to when the government wanted a locally manufactured V8, put some money on the end of a stick and away they went. Today its a different story all together, what was the last totally locally developed and manufactured engine using no foreign parts?

As for building multiple vehicles on the same production line, it's not recent innovation, they have been doing this for years, anyway it's part of evolution of a company. Practices need to keep up with the times, remain efficient and effective. Why do they need so much funding anyway, latest report show GM as number 1 and Toyota number 3 for world wide sales, I don't know about you but over 9 million units sold and they can't afford to train their personnel or develop new products. Something's not right if you can shift that many cars and still be a dollar short.

Ford US is investing over 2 billion in retooling, training and production facilities, yet they need 60M+ form Australian tax payers to keep the falcon till 2016, It's clear where their loyalties are.

Dave

[Reaper]

Food for thought on taxes

It's rarely a matter of tens of thousands of dollars. The same model can cost more than double or even up to three times as much in Australia.

In the most rarefied air of the luxury-car atmosphere, Britons can buy a Rolls-Royce Phantom limousine for the equivalent of $450,000; American buyers can waft along in the stately sedan for $373,000. In Australia, the Phantom costs millionaires more than a million: $1,068,000, to be precise.

Porsche's iconic 911 sports car starts here at $223,000. In Japan, its price tag converts to $134,000. Britain, $107,000. The US, ''just'' $77,200 - cheaper than HSV's Commodore-based GTS.

When Holden exported its Commodore SS to the US as the Pontiac G8 GT, it cost about $30,000, roughly $15,000 less than it costs here. What, how is that possible?

I can't speak for the cars listed above but in the case of the G8/SS version, what went to the US was a very stripped out version of the SS. They got the 6.2L HSV motor (from memory) which base cost to Holden would be near the same. The brembo brakes (same as what we know as redline) would have cost marginally more to Holden. Beyond that, retail prices in Australia include all state and federal taxes (excluding state stamp duties and reg) whilst prices quoted in NA usually don't include local taxes as they vary greatly. That all said, cars are cheaper in NA but then again, the average wage is less too.

Zeta platform was developed here,

LS engine foreign
Gearbox foreign
Suspension foreign
Head unit/ GPS/driver display foreign
Braking systems foreign

The engineers here homogenize it for local use. I'm not convinced that the funds they receive are showing a good ROI. Export for our local vehicles are drying up, Camry is a global car, the hybrid system was already in use OS, yet they received 100M to develop a hybrid in OZ.

Holden gets 100M+ to build the cruze, a car that was already being produced in other markets.

I am for funding, don't get me wrong, but look back to when the government wanted a locally manufactured V8, put some money on the end of a stick and away they went. Today its a different story all together, what was the last totally locally developed and manufactured engine using no foreign parts?

Overall it's about keeping not only the primary jobs, but the tier 1,2,3 and other indirect "multiplier" jobs that run from this industry. In that light the ROI is quite good.

As for building multiple vehicles on the same production line, it's not recent innovation, they been doing this for years, anyway it's part of evolution of a company. Practices need to keep up the the times, remain efficient and effective. What do they need so much funding anyway, latest report show GM as number 1 and Toyota number 3 for world wide sales, I don't know about you but over 9million units sold and they can't afford to train their personnel or develop new products. Something's not right if you can shift that many cars and still be a dollar short.

The Elizabeth plant is up amongst the top rung of assembly plants in the world making 2 cars in the top 5 sold in Australia and #1 if you combine the Ute and sedan/wagon sales of the Commodore together.

Reaper

[dmacey]

I can't speak for the cars listed above but in the case of the G8/SS version, what went to the US was a very stripped out version of the SS. They got the 6.2L HSV motor (from memory) which base cost to Holden would be near the same. The brembo brakes (same as what we know as redline) would have cost marginally more to Holden. Beyond that, retail prices in Australia include all state and federal taxes (excluding state stamp duties and reg) whilst prices quoted in NA usually don't include local taxes as they vary greatly. That all said, cars are cheaper in NA but then again, the average wage is less too.

Tax for a 50K plus car sold in the state of California

Sales or use tax: 6% State
County 1.25%
City up to 2.5%
Title: No Fee
Registration: $500
Plate transfer: $15
$50 Emissions Testing Fee**
Additional fees:
Dealer document preparation fee $55 (not required by law)

Total: $6,575 approx.

How fees are determined
Tax, title, and tags charges are based on five factors:
The state where you live
The county where the vehicle is registered
The weight of the vehicle
Whether you have a trade-in
The type of license plate you choose

Not even close to the amount of Taxes fees and charges we pay, wages might be cheaper but our cost of living more than makes up for the deficit.
The SS is a trimmed down Commodore, not sure what else they could have taken out of it. I know they should have left the speakers out. lol.

Overall it's about keeping not only the primary jobs, but the tier 1,2,3 and other indirect "multiplier" jobs that run from this industry. In that light the ROI is quite good.

I agree in principal, but its a false economy, if so many jobs are reliant on assistance then the core principals of the industry is flawed. Why produce products that will not be competitive on their own merits.

The Elizabeth plant is up amongst the top rung of assembly plants in the world making 2 cars in the top 5 sold in Australia and #1 if you combine the Ute and sedan/wagon sales of the Commodore together.

I don't doubt that the good people down in the Elizabeth production line are amongst the best in class, I do have doubts about the amount of their skill that are transferrable to other industries, becoming a specialist in a field that is shrinking will always offer a diminishing avenue of continuance. If we look at Toyota's recent 350 job cut, additional assistance will be made available to the effected former employees to up skill them to be better placed for re-empoyment. 100M worth of education would have sorted that out 4 years ago.

Dave

[Reaper]

I agree in principal, but its a false economy, if so many jobs are reliant on assistance then the core principals of the industry is flawed. Why produce products that will not be competitive on their own merits.

The problem is a global one and fundamentally I agree with the principal of (any industry really) being competitive on it's own merits. Unless governments around the globe all stop assistance all that will happen is Australia looses one of it's large industries. With that pragmatic approach I also agree that the car makers here should be making cars that sell. Holden are moving to the Cruze thus not all cars are in the large car segment basket. Toyota make the Camry/Aurion which is the medium 4cyl/6cyl segment. I'm not sure that taking the Falcon to a 4 cyl is the correct answer though. It's a lot of car for such a small motor to push around. Time will tell on that one.

I don't doubt that the good people down in the Elizabeth production line are amongst the best in class, I do have doubts about the amount of their skill that are transferrable to other industries, becoming a specialist in a field that is shrinking will always offer a diminishing avenue of continuance. If we look at Toyota's recent 350 job cut, additional assistance will be made available to the effected former employees to up skill them to be better placed for re-empoyment. 100M worth of education would have sorted that out 4 years ago.

Producing passenger cars is not a shrinking industry. The new car market has recovered strongly (particularly in Australia) since the GFC with over 1million new units selling in Australia these days and growing. The large car segment has undeniably shrunk over the last 2 decades but will find a floor at some stage. I firmly believe letting this industry go would be a catastrophic mistake. Once it's gone, getting it back would be near impossible.

Reaper

[dmacey]

The problem is a global one and fundamentally I agree with the principal of (any industry really) being competitive on it's own merits. Unless governments around the globe all stop assistance all that will happen is Australia looses one of it's large industries. With that pragmatic approach I also agree that the car makers here should be making cars that sell. Holden are moving to the Cruze thus not all cars are in the large car segment basket. Toyota make the Camry/Aurion which is the medium 4cyl/6cyl segment. I'm not sure that taking the Falcon to a 4 cyl is the correct answer though. It's a lot of car for such a small motor to push around. Time will tell on that one.

Agree with you here, time will tell if they can adjust to consumer trends or are they are simply playing catch up.

Producing passenger cars is not a shrinking industry. The new car market has recovered strongly (particularly in Australia) since the GFC with over 1million new units selling in Australia these days and growing. The large car segment has undeniably shrunk over the last 2 decades but will find a floor at some stage. I firmly believe letting this industry go would be a catastrophic mistake. Once it's gone, getting it back would be near impossible.

I was thinking along the line of shrinkage because of automation on the production line, I know that VW are currently building Passats with less than 5% human involvement. Robots build, and another robot comes and checks the work. The most human intensive part is paint correction (buffing) and final inspection.

I have also pulled up states from the Federal Chamber of Commerce

Australian Production
2005 - 388,985
2006 - 326,960
2007 - 334,772
2008 - 324,118
2009 - 223,354
2010 - 239,443
2011 - 141,939

This is the combined out put of all model made by Ford, Holden, Toyota & (Mitsubishi until 2008) the only remaining manufactures in Oz

We used to have

Australia Motor Industries who made Standard, Triumph, Rambler, Mercedec-Benz and Toyota.
They built the very first Toyota ever made outside of Japan in 1963, they closed shop in 1987

British Layland finished up in 1983

Chrysler sold their operations to Mitsubishi in 1981 and bailed, subsequently

Mitsubishi closed their doors in 2008

Nissan called it quits in 1992

and before that Rootes, who made Hillman, Humber and Singer cars called it a day back in 1965

The way I see it, Global production is up, but over all, Australian involvement is down. That has been the trend for some time.

Dave

[exec24]

Well as i said in an earlier post, Holdens are Cutting Jobs

[Full Spectrum]

Also when comparing US prices with AU prices, they seem to never pay less than full price. It's like they don't get a good deal. New Xr6 $32,000, new Sv6 $33,000, SS $39,000 driveway.. And from what i have seen GM makes nothing on commodore sales in the US.

[dmacey]

Also when comparing US prices with AU prices, they seem to never pay less than full price. It's like they don't get a good deal. New Xr6 $32,000, new Sv6 $33,000, SS $39,000 driveway.. And from what i have seen GM makes nothing on commodore sales in the US.

How do you figure that, just wondering ?

If you compare direct price for price unit for unit, driveway prices they seem to pay allot less.
I could be corrected.

Dave

[Reaper]

How do you figure that, just wondering ?

If you compare direct price for price unit for unit, driveway prices they seem to pay allot less.
I could be corrected.

Dave

In Australia it's not hard to get several (even many) thousand dollars off the cost of most cars. Very few will pay full retail. The discounts on offer in NA are usually manufacturer incentives and the dealer end negotiation is quite small. There is no doubt that cars in USA are cheaper than what we pay here but the gap is not as big as what it first seems.

Reaper

[Full Spectrum]

How do you figure that, just wondering ?

If you compare direct price for price unit for unit, driveway prices they seem to pay allot less.
I could be corrected.

Dave

Yes what reaper said .

Good example was the G6E-T price $59,000. G6E-T 50th Anniversary $52,000. Sure Americans wouldn't bother paying this over there. But true if it were to be available in the states it would be some $10,000 min less than here. But like wages they would look at our garbage guys getting close to or over $1,000 p/w and their US counterparts would be getting 20-30 % less. It's just so different.