Federal Industry Minister, Christopher Pyne, has backed a Belgian businessman’s plan to keep Holden’s South Australian manufacturing plant open past its current planned closing date in 2017.
Guido Dumarey, head of Punch International, wants to keep building the Holden Commodore and has asked Australian governments for support.
It is understood Mr Dumarey is seeking substantial assistance via the $800 million Automotive Transformation Scheme. Mr Pyne said he was behind the plan.
“Everybody in the Government would like there to be a car manufacturing business in Australia,” he told ABC Radio.
“I’ve engaged closely with him and with General Motors and given him a letter of support from the Commonwealth Government indicating we will do what we can to help him realise his goal,” Mr Pyne said.
Mr Pyne said Mr Dumarey had a “track record” of turning factories around.
He said if Mr Dumarey was successful in buying the plant from Holden and produced enough cars, he would be able to access money from the Federal Government’s Automotive Transformation Scheme until 2021.
“As the Industry Minister, my priority is to create jobs and growth, whether it is in South Australia or whether it is anywhere else in the country,” Mr Pyne said.
“I’m hopeful, but I’m not getting over-excited because I don’t want the workers at Holden to have two sets of periods of grieving.”
Mr Dumarey successfully turned a General Motors facility in France from a failing business into a profitable driveline component constructor, and Mr Pyne told ‘Today Tonight’ he believes the Belgian can do something similar here.
“Mr Dumarey does have a serious proposal, representing Punch Corporation. He’s done it before with General Motors at Strasbourg in Europe and I strongly support the efforts he’s putting into working with the South Australian, Victorian and Commonwealth Governments,” Mr Pyne said.
“A lot rests with the decisions that General Motors make in Detroit and that’s why I’ll be writing to the chairman of General Motors in Detroit, to the senior executive members there, encouraging them to have a very open mind to Punch Corporation’s proposal.
“I think they’re waiting to see a serious business case. Multi-national corporations are quite bureaucratic and I imagine they have quite serious processes to go through, but there are a couple of big positives for General Motors. One is if they can seriously pull off the keeping open of the plant at Holden and work with Punch, it’ll do a lot for their reputation in Australia. And, of course, if Punch Corporation takes over the remediation of the site at Holden it’ll save them a great deal of money.
“Having met with him a couple of times, I’m of the view that he can bring it off with government support and, of course, with the acquiescence of General Motors who are the ones who are selling the plant.”
Mr Dumarey has met with South Australian and federal politicians to enlist backing for his proposal. He is also attempting to obtain Holden’s rear-wheel-drive architecture intellectual property for the Commodore, as well as the facilities to keep building it. In early February he met with Prime Minister, Malcolm Turnbull, who, Mr Pyne said, was “very encouraging” of the plan.
However, Mr Turnbull said the plan was still a long shot and warned South Australians against getting their hopes up.
“It’s very encouraging, but I don’t think we want to get ahead of ourselves. They’ve obviously got to have talks with General Motors. There’s a lot of work that would need to be done,” he said on 5AA radio.
South Australian Premier, Jay Weatherill, confirmed he had met Mr Dumarey more than once. He said that although several proposals have been put forward for use of the Elizabeth site, Mr Dumarey’s would keep the Australian automotive manufacturing industry alive.
“There’s a growing awareness that the decision to close the car industry was beginning to look like a pretty big mistake,” Mr Weatherill said.
“The fact that we’ve got somebody who thinks he can continue to make the plant a car plant is a very interesting development, I think.
“With the low Australian dollar and the circumstances that pertain now, if the decision had been made in this environment I think a very different decision would have been made.”
Mr Weatherill cautiously endorsed the plan but, like Mr Pyne, was careful not to get too excited.
“If this [Mr Dumarey’s plan] stacks up and it’s the best use of the property from our perspective, we will certainty get behind it,” he said.
“We’ve got to assess how realistic it is. The truth is, if an idea is just pie in the sky, if an idea also requires a big Federal Government buy-in and if the Federal Government isn’t there as a willing partner, obviously that ends it.”
Mr Weatherill is meeting GM executives in Detroit this month, in a bid to get them to sign off on the deal.
A Holden spokesman was coy on the subject, saying only that Holden and GM would assess all options if a party was interested in one of their sites.
Every car maker has seen fit to pull out of Australian manufacturing. AADA hopes Mr Dumarey can arrest the decline.