Holden loses $1m in taxpayer funds after shutting Australian business

Image credit: General Motors

The federal government has taken firm action against General Motors by stopping $1 million in taxpayer funds after the company announced it will retire the Holden brand in Australia.

GM Holden, which received financial support through the Automotive Transformation Scheme (ATS), had been deregistered under an order by Industry Minister Karen Andrews.

Minister Andrews said she was extremely disappointed at GM Holden’s decision to walk away from local workers and dealers.

“Australian taxpayers have given this multi-national company more than $2 billion in financial assistance over recent years, and it still decided without consultation to wind up the Holden brand in Australia,” she said.

“I think you’d be hard-pressed to find a single Australian who thinks GM Holden should receive financial support from the federal government in the same year they announced they’re leaving our shores.”

The ATS reimburses eligible investment in research and development, and plants and equipment, with payments are made in arrears.

The decision to deregister the company was made on the basis that GM Holden’s activities will no longer encourage competitive investment and innovation in the Australian automotive industry and place the industry on a sustainable footing.

It reflects the loss to automotive research and development in Australia, including GM Design Australia and GM Holden Engineering teams, and the closure of GM Holden’s Lang Lang Proving Ground and Port Melbourne design studio.

According to an announcement on the Holden website, an assessment of the investment required for the company to remain competitive found it could not deliver an appropriate return on investment in the long term.

The Holden operations will be retired by 2021.