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Holden wins taxpayer-funded aid deal
HOLDEN has secured a $275 million taxpayer assistance package, ensuring it will build two all-new cars in Australia in the second half of this decade.
The car maker has committed $1 billion under the co-investment deal.
GM Holden chairman Mike Devereux said the funding would secure the next generation of Holden cars.
"Co-investment of this kind is critical for our industry and helps Australia compete against other car making countries that protect their industries through tariffs and/or financial support," he said.
The federal government has contributed $215 million from the existing $5.4 billion New Car Plan, with the balance provided by South Australia and Victoria.
Julia Gillard said the deal would inject an estimated $4 billion into the Australian economy and support thousands of jobs across the industry.
"This is a strategic co-investment, this is not a handout," the Prime Minister said.
The federal and Victorian governments will also provide an additional $35 million to help auto components firms move into export markets.
Ms Gillard said if the government had failed to provide assistance to Holden, the company would have closed its Australian operations, in a "knock-out" blow to the manufacturing sector.
She said the business case factored in the Australian dollar continuing at around parity with the US dollar into the future.
Mr Devereaux said the impact of the looming carbon tax on vehicle production was also considered.
The partnership will see Holden making cars in Australia until at least 2022, retaining domestic manufacturing, design and engineering operations.
Holden said the two new Holden models would be produced in Elizabeth, in South Australia.
South Australian Premier Jay Weatherill said the car maker's future was vital to the state's manufacturing sector.
"The manufacturing industry must become and advanced manufacturing industry," he said.
"That's why it is essential that we invest in Holden's future and that's why Holden's future is essential to Australia's future."
Holden said it was conscious of the need to deliver a return on investment for Australian taxpayers over the 10-year life of the program.
Mr Devereux said the industry needed the investment to retain its ability to design, engineer and build cars.
"Co-investment of this kind is critical for our industry," he said.
"Australia does not compete on a level playing field and without co-investment this country would struggle to attract new capital investment.
"Be assured, this is a very sound investment and we are being very conservative."
The new vehicles will utilise new fuel-saving technologies and more efficient engines, transmissions and drive trains.
Mr Devereux said Australia would be part of the "global reality" of the car industry, working on developing new technologies that might not even be used in Australian cars.
"We will be much more tightly connected to GM's international operations," he said.
"Gone are the days when you can engineer a car for one country and hope for that to be economically feasible, so we'll be putting our engineering and design talent to work as they already are.
"We'll continue to work on global products in this country and, as Prime Minister Gillard said, be part of that new reality in the global industry."
Industry Minister Greg Combet said the shift to global vehicle platforms would apply pressure to Australia's car components industry, but it would also provide opportunities to become part of new global supply chains.
Without the investment, GM had warned it would leave Australia by 2016.
The federal and Victorian governments and Ford entered into a co-investment deal in January worth around $103 million, to keep the company's Melbourne plant open until at least 2016.
Cookies must be enabled. | The Australian
HOLDEN has secured a $275 million taxpayer assistance package, ensuring it will build two all-new cars in Australia in the second half of this decade.
The car maker has committed $1 billion under the co-investment deal.
GM Holden chairman Mike Devereux said the funding would secure the next generation of Holden cars.
"Co-investment of this kind is critical for our industry and helps Australia compete against other car making countries that protect their industries through tariffs and/or financial support," he said.
The federal government has contributed $215 million from the existing $5.4 billion New Car Plan, with the balance provided by South Australia and Victoria.
Julia Gillard said the deal would inject an estimated $4 billion into the Australian economy and support thousands of jobs across the industry.
"This is a strategic co-investment, this is not a handout," the Prime Minister said.
The federal and Victorian governments will also provide an additional $35 million to help auto components firms move into export markets.
Ms Gillard said if the government had failed to provide assistance to Holden, the company would have closed its Australian operations, in a "knock-out" blow to the manufacturing sector.
She said the business case factored in the Australian dollar continuing at around parity with the US dollar into the future.
Mr Devereaux said the impact of the looming carbon tax on vehicle production was also considered.
The partnership will see Holden making cars in Australia until at least 2022, retaining domestic manufacturing, design and engineering operations.
Holden said the two new Holden models would be produced in Elizabeth, in South Australia.
South Australian Premier Jay Weatherill said the car maker's future was vital to the state's manufacturing sector.
"The manufacturing industry must become and advanced manufacturing industry," he said.
"That's why it is essential that we invest in Holden's future and that's why Holden's future is essential to Australia's future."
Holden said it was conscious of the need to deliver a return on investment for Australian taxpayers over the 10-year life of the program.
Mr Devereux said the industry needed the investment to retain its ability to design, engineer and build cars.
"Co-investment of this kind is critical for our industry," he said.
"Australia does not compete on a level playing field and without co-investment this country would struggle to attract new capital investment.
"Be assured, this is a very sound investment and we are being very conservative."
The new vehicles will utilise new fuel-saving technologies and more efficient engines, transmissions and drive trains.
Mr Devereux said Australia would be part of the "global reality" of the car industry, working on developing new technologies that might not even be used in Australian cars.
"We will be much more tightly connected to GM's international operations," he said.
"Gone are the days when you can engineer a car for one country and hope for that to be economically feasible, so we'll be putting our engineering and design talent to work as they already are.
"We'll continue to work on global products in this country and, as Prime Minister Gillard said, be part of that new reality in the global industry."
Industry Minister Greg Combet said the shift to global vehicle platforms would apply pressure to Australia's car components industry, but it would also provide opportunities to become part of new global supply chains.
Without the investment, GM had warned it would leave Australia by 2016.
The federal and Victorian governments and Ford entered into a co-investment deal in January worth around $103 million, to keep the company's Melbourne plant open until at least 2016.
Cookies must be enabled. | The Australian