SA to consider Holden’s latest offer under $200m bailout deal

Automotive manufacturing giant General Motors Holden has reportedly made a “final” proposal to the South Australian state government on an agreement to keep the company operating in Australia, The Australian has reported.

The SA Government and Holden are currently in discussions over a $200 million bailout deal. SA Premier Jay Weatherill said on Monday that he had received a “final” offer from the auto maker regarding the bailout.

Holden’s offer will be consider by the SA and the Federal Government, as well as the GM board in the U.S. Weatherill said the deal on offer will reportedly secure Holden’s future in SA until at least 2022, according to the report.

Last week, GM Holden announced that it would cut back its South Australia, Elizabeth assembly operations to a single shift from May.

The company will cut the second assembly shift at its Elizabeth plant. The downsizing will see Holden Australia shed about 150 contract workers and casual jobs. The company will added the remaining permanent workers to the main shift so they can assemble cars more quickly. The company claims that no permanent jobs will be affected by the shift change.

From May 2012, Holden said it will cut-back to ‘around 400’ vehicles per day, citing weakening export demand for its lower production volume.

In August last year, the automotive manufacturer raised production levels from 430 to 480 units per day, due to the success of the locally-made Cruze.

In May 2010, Holden Australia was given $2.03 million in Federal Government funding to further develop ties with its component and materials suppliers. Ford, Toyota and the Co-operative Research Centre for Advanced Automotive Technology also received funding under the $10 million Automotive Supply Chain Development Program aimed at helping the automotive industry to break into global supply chains.

That same month Holden also received a further $40m million grant from the Government’s Green Car Innovation Fund to manufacture a more fuel-efficient Commodore.

Over the past three years Holden received $149m in federal funding to re-build its Cruze production line at Elizabeth. The Cruze is a smaller, lower-emission car than Holden’s usual offerings.