General Motors Co. has pledged to shell out A$1 billion or US$1.04 billion over the next decade for its operations in Australia. The commitment comes after securing Australian government support to help it carry on with its vehicle facility operations until at least 2022. Prime Minister Julia Gillard disclosed that the national and two state governments would bring in A$275 million into GM Holden in the latest hand out to the struggling vehicle manufacturers in the country in order to protect manufacturing jobs.
GM Holden and the Australian units of Ford Motor Co. and Toyota Motor Corp. -- three automakers in the country -- have all slashed employment because of the declining exports and sales brought about by a record high Australian dollar and the worldwide downturn.
Gillard stated that the investment will be a strategic one that will increase their economy. She further stated that the future of GM Holden has been made secure for the next 10 years. The Australian unit will be producing vehicles and competing in economic circumstances where the Australian dollar is expected to be about parity with the U.S. dollar, she continued.
Moreover, this funding will secure the jobs of 12,000 employees in GM Holden's Adelaide automobile facility and engine manufacturing factory in Victoria. It will also support thousands of additional manufacturing jobs in the components sector.
In February, GM Holden slashed 140 jobs from its Adelaide vehicle factory. On the other hand, Toyota disclosed in January that it was slashing 350 jobs at its Australian manufacturing operations. According to the latest government figures, almost 250,000 vehicles were produced in Australia. This demonstrates a steady drop from more than 400,000 units in 2004 and around 320,000 in 2008.