GM Weighs Options With Holden Ahead of Australia Exit
As the Australian government envisions a doomsday scenario for the country’s auto industry, General Motors (NYSE:GM) may have options with its Holden brand prior to exiting operations Down Under. The Australian Associated Press reports government officials may try to persuade the automaker to part with Holden in hopes of saving automobile production in Australia for the time being. GM is trying to tie up loose ends in the region as part of a more efficient global strategy.
GM announced in December 2013 that its operations in Australia would cease by 2017, joining Ford (NYSE:F) in abandoning production in a country where business conditions — exacerbated by the strength of the national currency — have proven unmanageable for global automakers. Government subsidies for the industry are drying up, which leaves automakers in Australia with the prospect of facing heavy losses or closing up shop.
The top elected official of South Australia, where one of the two GM plants is located, broached the idea of parlaying the Holden brand in hope of bringing another automaker to the table. It’s unclear whether that move would be considered by General Motors and if there is an automaker willing to take on the associated risks. For GM, cutting losses in the region has become central to the company’s strategy.