Holden has announced plans to close part of its Melbourne operations, prompting layoffs of over 500 car workers.
Holden says it is to end production of its GM Europe-designed Family II, four cylinder cast iron engine line at Fisherman’s Bend, Melbourne, in the final quarter of 2009, putting 530 direct jobs – including those in a foundry which will also close – at risk.
Holden has made the engines for 27 years, launching production initially for the European Vauxhall Cavalier and its own version of GM’s ‘global J-car’, the Camira, in 1981.
The automaker said production at its global V6 engine facility in Port Melbourne would not be affected, adding it plans to expand the range by adding fuel-saving and alternative fuel technologies to increase domestic and export sales.
Over four million of the Family II engines have been made in Australia and all were exported from 2000 onwards. The engine is now shipped only to China, Thailand and Korea.
Holden currently employs about 3,100 people in Victoria and 6,500 nationally.
The company is wholly owned by US parent General Motors Corp., which last week announced plan to close four truck factories in North America as demand for its larger vehicles shrinks.
Record fuel prices have turned many consumers away from the traditional six-cylinder sedans built in Australia by Holden, Ford and Toyota, the remaining local car makers. Higher interest rates are also denting demand for new cars in general.