General Motors’ post-Holden launch of new brand angers dealers

General Motors’ launch of a new car business in Australia, just months after it axed Holden, has been branded ‘unthinkable’.

The Chevrolet Silverado

The body representing new car dealers has hit out at General Motors for announcing it will launch a new vehicle brand in Australia and New Zealand, just months after the automotive giant axed the iconic Holden brand and “ruthlessly” dismantled the Holden dealer network.

On Tuesday, GM Holden announced it will launch a new car business in Australia and New Zealand offering “hand-picked” GM vehicles to consumers.

The new business, called GM Specialty Vehicles, will compete in the luxury full-size pick up and sports car segment and will launch with the Chevrolet Silverado 1500 LTZ ute, followed by the RHD Corvette.

The company said the American Silverado would be re-manufactured into right-hand-drives at the Walkinshaw Group’s Melbourne facility, where high-performance cars are remodelled for road use.

Walkinshaw was previously involved in the manufacture of Holden Special Vehicle cars, which have been discontinued alongside the rest of the brand.

The “retirement” of the Holden vehicle brand, announced in February, was met with indignation from many independent Holden dealers. They say they were forced to sign an “inadequate” compensation package providing dealers with a settlement of $1500 per vehicle over the next two and a half years, plus the opportunity to serve as an authorised service provider for Holden vehicles for the next five years.

GM’s local outfit, GM Holden, has defended the package – which has now been accepted by at least 90 per cent of dealers – but the controversy has led to government-supported mediation efforts, a push by Labor to significant changes to the franchise code, an investigation of GM Holden by the ACCC and appearances of GM executives in front a Senate committee.

Australian Automotive Dealer Association CEO James Voortman said that GM Holden’s decision to launch a new brand was “unthinkable”.

“GM remains in dispute with a number of dealers and most who have settled did so under duress, accepting the inadequate compensation on offer,” Mr Voortman said.

“Even a last minute request from the federal government to settle the dispute through arbitration was rebuffed by GM,” he said.
“GM has burned so much goodwill after taking so much from Australian taxpayers, yet here they are about to start another business.”

Mr Voortman called on government authorities to heighten their scrutiny of GM Holden.

“We know Senator Deborah O’Neill has written to ASIC asking them to investigate a potential phoenixing situation regarding GMSV. We also know that last year, only months before announcing it was dumping the Holden brand, General Motors changed its corporate structure,” he said.

“It is important to get to the bottom of these issues as GM will have significant liabilities in Australia for many years to come.

“The Senate inquiry looking into GM’s operations in Australia should strongly consider calling GM back to answer more questions.”

General Motors Holden interim chairman and managing director Kristian Aquilina said the launch of GMSV, headed by the new director of GM speciality vehicles, Joanne Stogiannis, would create jobs within GM’s ranks in Australia and support 150 jobs at the Walkinshaw facility.

General Mortors Holden’s Kristian Aquilina

“I am proud to be announcing GM Specialty Vehicles which represents an important new investment by GM in Australia,” Mr Aquilina said.

“This new venture directly adds sales, marketing and aftersales roles to GM’s 200-strong presence in Australia, and indirectly supports over 150 skilled engineering and manufacturing jobs at our partner in Victoria.“