* GM Holden chief says more govt assistance required
* Acting PM demands immediate clarification on plans
MELBOURNE Dec 10 General Motors Co said
on Tuesday it has made no decision on whether to stop making
cars in Australia after 2016, provoking an angry reaction from
the Australian government which demanded that the U.S. automaker
clarify its plans.
Speaking before a government-appointed panel looking into
the future of Australia's beleaguered car industry, Mike
Devereux, head of GM's Holden unit, also said GM would need more
assistance from the Australian government to survive long
"We need a public-private partnership over the long term to
be relatively competitive," he said in closely watched comments
amid debate that GM could follow other automakers in pulling the
plug on Australian manufacturing.
The auto industry in Australia has depended on government
support for years due to soaring costs, a strong Australian
dollar, cheap imports and weak exports.
Japan's Mitsubishi Motors Corp exited in 2008 and
Ford Motor Co announced in May it would close its two
Australian auto plants in October 2016.
There are widespread concerns that any exit by GM Holden
will be followed by Toyota Motor Co, causing a collapse
of the entire domestic industry, supporting more than 40,000
workers and 150 supplier companies.
Acting Prime Minister Warren Truss criticised the lack of
commitment from Holden.
"Your comments merely confirmed that a decision to end
manufacturing in Australia remains a live option and has not
been ruled out," he said in a letter to Devereux that was
released to the media.
"It is the Australian government's view that GM Holden must
immediately provide a clear explanation of its future intentions
and explain what its plans are for its Australian manufacturing
Truss said the Federal government had provided more than A$1
billion in support to the industry in recent years and had
committed to a further A$1 billion between 2015-2020. It has
ruled out increasing subsidies.
Truss is acting prime minister while Tony Abbott is visiting
South Africa to attend the memorial for Nelson Mandela.
Devereux said it cost $3,750 more to build a car in
Australia than at GM's other plants in Asia, and that gap would
have to shrink with the help of government assistance and
further cost-cutting in order to keep the operations open.
He praised the U.S. government's decision to bail out car
makers during the global financial crisis, saying that had
spurred the industry's resurgence, and said as the No.2 car
brand in Australia, Holden wanted to continue making cars here.
"The budgetary cost of losing this industry would dwarf the
cost of keeping it," he said.
Devereux declined to say how much assistance the company had
sought from the government, but the Labor opposition's industry
spokesman Kim Carr has said Holden would keep its plants open if
it received A$150 million ($136 million) a year.
Even with government support, Devereux said Holden would
look to cut the local components used in its flagship Commodore
cars beyond 2016 to around 25 to 30 percent from 50 percent of
the vehicle currently.
Holden, which claims a 10 percent share of the Australian
market, posted a A$153 million loss in 2012. It employs nearly