GM to Shutter Holden Division in Australia

The company said it would focus on more profitable markets.
Lauren MuskettFebruary 17, 2020
GM to Shutter Holden Division in Australia

General Motors will wind down sales, design, and engineering operations in Australia and New Zealand and retire its Holden brand by 2021. The Holden brand had been in operation for more than 160 years.

The largest U.S. automaker will also withdraw the Chevrolet brand from Thailand and sell its Rayong plant to China’s Great Wall Motor as it exits poor-performing markets.

“After comprehensive assessment, we regret that we could not prioritize the investment required for Holden to be successful for the long term in Australia and New Zealand, over all other considerations we have globally,” said Julian Blissett, senior vice president for international operations at GM.

CFO Insights on Inflation, Workforce Challenges, and Future Plans 

CFO Insights on Inflation, Workforce Challenges, and Future Plans 

Download our 2022 survey report for a high-level view of finance team projections and strategies, directly from our executive readers.

The automaker said it will focus on the specialty vehicles business Australia and New Zealand.

GM said it will take a write-down of $1.1 billion mostly in the first quarter from the closure, including about $300 million in cash losses.

“I’ve often said that we will do the right thing, even when it’s hard, and this is one of those times,” chief executive officer Mary Barra said. “We have the right strategies to drive robust returns, and prioritizing global investments that will drive growth in the future of mobility.”

The closures could result in the loss of 600 jobs.

“I am disappointed but not surprised. But I am angry, like I think many Australians would be,” Australian Prime Minister Scott Morrison said. “Australian taxpayers put millions into this multinational company They let the brand just wither away on their watch. Now they are leaving it behind.”

The brand’s future in Australia has been in doubt since 2013 when GM announced that it would stop making cars in Australia. In 2017, its final Australian-made vehicle rolled off the line at a factory in Adelaide.

GM has also restructured its businesses in South Africa and India and transferred operations in Vietnam to a local automaker in recent years.

Fairfax Media via Getty Images

4 Powerful Communication Strategies for Your Next Board Meeting