Manufacturing News

Holden to stay – Carr

Rumours of General Motors selling its Holden car manufacturing operation in Australia have been squashed by industry minister Kim Carr.

Despite fears that GM would run out of cash next year, Carrr said the company’s chief executive, Rick Wagoner, was positive about the future of its plant in Elizabeth, north Adelaide.

“He has made the point very, very clear to me, how important it is that we not only keep plants of this quality within the GM family but also that we have a very strong supply base to ensure the ongoing prosperity of the company here in Australia,” Senator Carr said.

The minister was in Adelaide yesterday (Thursday) to brief local auto industry officials on the government’s $6.2bn assistance plan.

He said the plan would make the industry more environmentally and economically sustainable by 2020.

The government’s plan came as GM warned this week that its finances were so bad that it needed a US government aid package before president-elect Barack Obama took office in January. Last week the company said it would run out of cash in the first half of next year.

However, latest news from the US is that US Treasury Secretary Henry Paulson has ruled out the possibility of using part of the US$700bn rescue plan to help the struggling auto industry.

Paulson said the Troubled Asset Relief Program was targeted to the financial sector and thus could not be used to bail out carmakers unless Congress amends the plan.

“We care about our auto industry,” but added that “the intent of the TARP was to deal with the financial industry.”

Paulson pointed out that legislation passed recently included US$25bn to help automakers retool to make more fuel-efficient vehicles, although those funds cannot be used for immediate short-term cash needs.

“One option would be to amend that bill to make it available,” he said. “We need a solution but the solution has got to be one that leads to viability,” he added.

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