GM Detroit Puts Axe Through Holden: High Farce At Productivity Commission Photo:
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Tim O'Brien | Dec, 12 2013 | 25 Comments


So, General Motors Detroit has now made its decision: yesterday it informed us that Holden is to shut down its manufacturing operations by 2017.

This is, apparently - or so it would have us believe - something it hadn’t decided ‘the day before’ yesterday.

Because ‘the day before‘ was when Holden MD Mike Devereux fronted the Productivity Commission of Inquiry into Australian Automotive manufacturing.

Then, Mr Devereux told the Commission that GM had not set a timeframe on a decision, and added the curious bon mot that the hearing was not the time to speculate (about Holden’s future).

That was 24 hours earlier.

Seems to me then that Mr Devereux’s appearance before the Commission, and the jousting with Government in the weeks preceding yesterday’s announcement, was bullshit.

Bullshitting the Australian Government, bullshitting the Productivity Commission, bullshitting Holden workers and suppliers, and bullshitting the community.

And we swallowed it in lumps. You, and me, and people like the AMWU’s Dave Smith who told the ABC that Mr Devereux's assurance was good news.

"It keeps us in the ball game. It's been a difficult time but we've had some discussions and he's made it very clear to me that Holden wants to remain in Australia but it's about the government having the right policy settings to allow it to do so," Mr Smith said.

And Federal Industry Minister Ian MacFarlane - protesting as late as Monday that no decision had been made - well, he was given a feed.

As was South Australian Premier Jay Weatherill. He said he had been assured “personally” by Holden managing director Mike Devereux that no decision had been taken.

So what was the point of Mr Devereux’s appearance at the Productivity Commission other than an exercise in high farce?

I know Mr Devereux; he tackles ‘the hard stuff’ of doing business in one of the toughest industries on the planet like a linebacker.

He’s tough, agile and smart, and both willing and able to chest-up to Government and to play the hard man for the company he represents.

What then was going on at the Productivity Commission? Disingenuousness is certainly not Mr Devereux’s style.

In all likelihood GM had made its decision in the weeks earlier.

And those rumours from the offices of senior Federal Ministers, and the commentary in the Wall Street Journal and elsewhere detailing GM’s intent to close its Australian manufacturing outpost, were rooted in fact - as many of us suspected.

It now seems certain that the timing of GM’s decision had more to do with a global revamp of its operations - the withdrawal of the Chevrolet brand from Europe and the redirection of a greater part of GM Korea’s manufacturing output to Australia and South East Asia - than anything an Australian Productivity Commission of Inquiry might decide.

And it certainly had more to do with the global strategies of a distant boardroom than the contents of any ‘package’ being borne by a now seriously embarrassed Industry Minister Ian MacFarlane.

And little to do with a stingy Australian Government who, it seems, sees automotive manufacturing as an ‘un-sacred cow’, and one that it’s perfectly happy to sacrifice on the altar of dry economics.

In all likelihood, GM Detroit knows there is nothing in an Australian Government’s shallow pocket - shallow by choice - that will ever warrant an inclusion on a GM boardroom agenda.

That’s what happens when you’re running a company that’s bigger than most countries, and why GM couldn’t give a flying continental about some curious antipodean inquiry as to whether we can afford a car industry or not.

Less than farce, just dismissive disinterest. And that’s why we’ve lost the part of Holden that matters; and why all Australia will be the poorer.

It is strange indeed that the 12th wealthiest country in the world (by GDP: 2012 International Monetary Fund) apparently can’t afford to keep its own motor industry.

There is of course a cheer squad behind the limp response of Government to the growing crisis in this industry sector - a coven of economic dries who abhor such industry assistance and ‘co-investment’ of the type Holden was seeking.

But who can remain magnificently silent on similar such assistance to other sectors. Like the billions in tax concessions to the resources sector through the diesel rebate.

In fact every industry sector has a begging bowl it puts before Government. The Productivity Commission's annual review of industry assistance shows that the Australian Government provided Australian industry with $10.5 billion in assistance in net terms in 2011-12.

The finance and insurance industry gets more than the car industry - $914million in 2011-12: were you aware of that?

Property and business services - at $611million - got around the same amount dropped into its bowl as the $620million the motor vehicle and parts industry received.

Primary producers get double: nearly $1.45billion in budgetary assistance to farming, fruit growing, fisheries, forestry and logging.

The list goes on.

Now, with Holden's departure, we find Toyota suddenly vulnerable. Perhaps, wait a year or two, and the Government will have one less line item of expenditure and one less industry listed in that Productivity Commission annual review of industry assistance.

That small win for economic purity aside, at the end of the day it’s impossible to find a winner here.

Certainly not GM; the farcical high-handedness of its behaviour leading into this day does it no credit at all.

And certainly not the brand in this country. The passing of Holden manufacturing here will see Holden’s market share cut to ribbons.

And certainly not Holden dealers, nor their staff.

Neither the thousands of Holden workers, nor the tens of thousands employed by the parts and components sector.

And neither Australia. I suspect that yesterday we made ourselves just a little dumber, a little less capable.

After all, it doesn’t take much in the way of brains to drop a bucket of dirt into a ship and have it float away somewhere.

Tim O’Brien
TMR Managing Editor

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