GM may start exporting vehicles from South Korea to Australia

Article by Christian Andrei, on December 9, 2013

General Motors is considering a plan to export vehicles from South Korea to Australia as part of a global restructuring that entails dropping the Chevrolet brand in Europe and scrapping production in Australia, a source told Reuters. Australian media reported that GM has decided to withdraw from the country as early as 2016, which means vehicles to be sold there has to be sourced elsewhere.

One possible source is South Korea, where GM's sites are affected by a recent announcement that it will drop the Chevrolet brand in Europe by the end of 2015. While GM Korea exported 187,000 Chevrolets to Europe in 2012, the brand has failed to capture a significant market share.

"GM Korea could consider exporting Korean-made cars such as the Cruze compact to Australia if it were to shut down a plant there," the source told Reuters, adding that the company has yet to begin talks on the plan. In 2012, GM Korea exported about 30,000 vehicles -- including Barina/Aveo subcompact and Captiva SUVs -- to Australia, sold under the Holden badge.

There are worries that an exit by GM from Australian production would also influence other carmakers -- like Toyota -- to do so, and the auto industry that has been struggling in the country may face a collapse.

"When Holden pulls out of this country, it will be a domino effect," remarked Sen. John Madigan. He remarked that car parts suppliers have already lost "critical mass" with the decision of Ford to pull out of Australia. He noted that if another carmaker pulls out, "then we're going to be hearing about Toyota -- there are going to be tens of thousands of jobs lost."

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