Thread: Holden axed in Aussie.

Here is an argument Holden AKA GMH should have concentrated on the auto components sector, rather than car manufacture, after tariff ptotection was removed. In other words it was a flawed business model. Makes sense, too late now of course.

"In retrospect, we can sympathise with governments not wishing to pull the plug on a major industry employing many thousands of workers. Not many countries can sustain an integrated car manufacturing industry. Most don’t even try. Those that succeed do so because they can control their own destiny, including investing in future technologies, skills and market development. The only part of the Australian car industry that could control its own destiny was the auto components sector, which was world-competitive. "

Holden's dead end shows government policy should have taken a different road


Roy Green

Emeritus Professor & UTS innovation adviser, University of Technology Sydney

Sounds logical, if Detroit had been prepared to buy Australian-made components.

Originally Posted by DiscoMick

Sounds logical, if Detroit had been prepared to buy Australian-made components.

Problem was that the government got in bed with Detroit in 1947, with no Australian control at all. Head office was never going to let the Australian arm compete with head office. If the Australian government had been prepared to back an Australian company to the extent they did the foreign ones, there may have been a case for making cars here, although that is unlikely, as it would have needed a lot of exports to get the volume needed. And Australia has always been a poor place for manufacturing compared to most of our competitors, for a wide range of reasons. Not just the cost of labour, but tax structures, shortage of capital, distances, transport costs, power costs, land costs etc etc! In 1947 there was very little transport by road - it was all by rail, run by state monopolies, or by sea, with your shipping at the mercy of waterside worker's and seamen's unions and near monopoly ship owners and stevedoring companies..

Originally Posted by JDNSW

Problem was that the government got in bed with Detroit in 1947, with no Australian control at all. Head office was never going to let the Australian arm compete with head office. If the Australian government had been prepared to back an Australian company to the extent they did the foreign ones, there may have been a case for making cars here, although that is unlikely, as it would have needed a lot of exports to get the volume needed. And Australia has always been a poor place for manufacturing compared to most of our competitors, for a wide range of reasons. Not just the cost of labour, but tax structures, shortage of capital, distances, transport costs, power costs, land costs etc etc! In 1947 there was very little transport by road - it was all by rail, run by state monopolies, or by sea, with your shipping at the mercy of waterside worker's and seamen's unions and near monopoly ship owners and stevedoring companies..

I seem to remember a story that the then Chairman of GM in the 40's questioning why they were doing business in and with a government of a country so Socialist that its railways were State owned

Originally Posted by rick130

I seem to remember a story that the then Chairman of GM in the 40's questioning why they were doing business in and with a government of a country so Socialist that its railways were State owned

Yes, that probably increased the price Chifley had to pay to get Holden established as a manufacturer!

Originally Posted by rick130

I seem to remember a story that the then Chairman of GM in the 40's questioning why they were doing business in and with a government of a country so Socialist that its railways were State owned

I didn't realise you were that old, Rick.

Originally Posted by V8Ian

I didn't realise you were that old, Rick.

Hold my age well, don't I?

Originally Posted by rick130

Hold my age well, don't I?

Better than Mrs 4Bee thinks Des does.