Is Australia Better Without Car Manufacturing? General Motors Thinks So.

By now, most know that Australia is turning to import-only when it comes to their vehicle purchases. GM, owner of Holden, was one of the first to announce that it was taking car manufacturing off the table for the country. Shortly thereafter, Toyota followed. But what led to this mass exodus of manufacturing, and why is it ultimately a good thing for Australia?

Stefan Jacoby is the international General Motors executive who announced the closure of the Holden factory in Elizabeth.

"You have identified me as the one who made the call for stepping out of manufacturing in Australia,” Jacoby said in Detroit to Australian media. “Yes, I am the guy who made finally this decision and presented this to the board.”

Jacoby believes that Australia is better off without manufacturing, saying that government incentives are no way to form a business and keep it sustainable. With the reduction of import tariffs and the Federal Government’s decision to sign more Free Trade Agreements with other Asia-Pacific companies, the decision was clear. Approving the closing of the factory in Elizabeth means that 1,400 Holden factory workers will be out of the job within the next three years, putting Jacoby in a tough situation when he says he believes it was the right decision.

"But I am of the strong opinion that this was the right thing for Australia and this was the best thing for Holden overall," he said.

What Jacoby wants the world to know is that even though Holden’s manufacturing arm of the company is shutting down, the Holden brand is not.

"I think I have underestimated the uncertainty of our consumers and maybe from the very beginning we should have made more efforts to clarify that the decision to wind down our manufacturing has nothing to do with our presence as well," he said.

"The major concern of our customers is our commitment to stay in Australia. We have not communicated strong enough. Holden is an iconic brand and would be stupid to give this up."

Information sourced from Cars Guide.