This afternoon General Motors announced the end of the Holden. In its 164 year history, Holden was one of the most loved brands in Australia, known best for the Commodore, it offered a crazy level of performance at an affordable price.
After ceasing local production in 2017, things were heading in a bad direction for the company, with sales taking a severe downturn.
“I’ve often said that we will do the right thing, even when it’s hard, and this is one of those times.
We are restructuring our international operations, focusing on markets where we have the right strategies to drive robust returns, and prioritizing global investments that will drive growth in the future of mobility, especially in the areas of EVs and AVs.
GM Chairman and CEO Mary Barra.
If you’re thinking GM is about to simply replace the Holden products with vehicles wearing a different badge.. think again. Notice the lack of Australia in this list.
“In markets where we don’t have significant scale, such as Japan, Russia and Europe, we are pursuing a niche presence by selling profitable, high-end imported vehicles – supported by a lean GM structure.”
GM International Operations Senior Vice President Julian Blissett
As recently as December, Holden had announced it’d cease production of sedans, in favour of chasing the biggest market segments, SUVs and Utes. Again another warning sign things weren’t great and they were chasing greater profitability.
Over the last decade, we’ve seen Holden’s sales tank, falling from 132,923 in 2010, to just 43,176 last year. It’s not surprising that 3,598 sales per month can’t justify the cost of operations for parent company General Motors.
GM has had its own struggles with demand, selling just 7.7 million vehicles in 2019, falling from 8.4 million in 2018.
The end of Holden should serve as a massive warning signal for other automakers that continue to fail to not only listen to what customers want from vehicles, but also predict future demand.
As a result of these actions in Australia, New Zealand and Thailand, the company expects to incur net cash charges of approximately $300 million. The company expects to record total cash and non-cash charges of $1.1 billion.
Source: General Motors
While Holden has had their hits and misses design-wise, recent products like the Arcadia, the Equinox and even the newest Commodore have not been bold enough. The company produced vehicles that tried to appeal to everyone and ended up appealing to nobody.
When it comes to technology, sure Holden followed many others and raised the white flag to smartphone auto platforms Android Auto and Apple CarPlay. The biggest failing may be the missed opportunity to leverage the investments made by parent GM to bring future-looking vehicle platforms like the all-electric Bolt to Australia.
If it’s not clear already, the shift is on to Electric Vehicles and the companies prepared to lean into that future are reaping the rewards at the cost of market share from legacy auto brands that desperately cling to the past.
The challenge for all vehicle manufacturers is to transition to EVs while not destroying their income from existing products. Unfortunately, Holden is one of the first big-name brands to falter but they certainly won’t be the last.
Holden could have carved out a decent market in Australia and around the globe, had they used GM’s R&D resources to innovate and create a fleet of vehicles for the future. A great-looking, great performing vehicle at a great price should have been Holden’s road trip to future success, but that’s been squandered.
So who’s to blame for the demise of Holden? Many are keen to point the finger at the Government but that’s wrong. Consumers are also not to blame, they simply but cars that answer the needs and wants of their family.
Ultimately the blame has to rest with the people at the top of the company and in the last 10 years, Holden has had 7 different leaders.
- Alan Batey (2009–2010)
- Michael Devereux (2010–2014)
- Gerry Dorizas (2014–2014)
- Jeff Rolfs (Interim chairman and managing director) (2014–2015)
- Mark Bernhard (2015–2018)
- Dave Buttner (2018–2019)
- Kristian Aquilina (Dec 2019 – present) [Acting Chairman and Managing Director]
With falling sales, it’s inviting to replace the person at the top and hopes that’s an easy solution. It wasn’t. The disruption caused by exchanging a CEO or MD, is dramatic and in 2014, they had 3 different leaders in a single year.
A new person in the top seat of a company like this will almost always be conservative when the company actually needed someone bold and disruptive. Somewhere between 600 and 800 Australians will now lose their job by the end of 2020 as a result of the decisions the management and Holden and GM made.
It’s probably also worth reminding everyone about the decision to take the Summernats-loved real-wheel-drive Aussie-built commodore and make it a front-wheel-drive made half-way around the world, a move that angered the most avid fans of the nameplate.
General Motors owns a number of other brands, including Chevrolet, Buick, GMC, Cadillac that all risk the same fate if lessons are not learned here.
If you want to be around in 10 years, you have to have the balls to make the hard decisions. You’ve got to spend the money in R&D to catch up, create efficient electric vehicles with a great design, great range and great performance at the right price and that’s not easy.
If you work for an automaker and want to ensure you have a job in 10 years, call a crisis meeting today. Ask your boss the hard questions or it’ll you left finding another job, like the Holden workers are now.
GM is doing some interesting things through sub-brands like Cruise that focus on autonomous, all-electric urban transportation for medium density vehicles.
The Super Cruise technology in Cadillacs actually allows the driver to take their hands off the wheel, thanks to a driver monitoring system. Unfortunately, this is limited to the US.
GM also has a ride-sharing service, Maven. While it should have the resources to go after a decent slice of the market, Uber and Lyft still dominate and many people don’t even know about Maven, despite it launching in Australia back in 2017.
Then we come finally to Holden Motorsport. For decades the Supercars category has entertained fans around the country and overseas. The category relied heavily on the Holden vs Ford rivalry and while Ford has successfully transitioned from the Falcon to the Mustang, it seems the Commodore is just going to end.
Take a look at this comparison of automotive companies if you’re at all confused where the future is. By the way, that 100+ year history counts for exactly zero.
You can read the full release by General Motors on their website here, and Holden Australia’s full announcement here.
Naturally, with such an important announcement, there are plenty of questions, so Holden tried to provide some clarity around the implications of today’s announcement.
Is Corvette still coming to Australia and New Zealand?
We will work through this and share information in the coming months.
Translation: Don’t expect it.
What is the future of Holden in Supercar racing?
We will begin discussions with the organisers of Supercars and Red Bull Holden Racing Team. We will update you on these discussions at the appropriate time.
Will Holden continue to sponsor Red Bull Holden Racing Team Racing?
We are aware of our commitment and we will work through with Red Bull Holden Racing Team the implications of this decision.
Translation: Supercars has a massive issue on its hands going forward.
Can I still buy a new Holden?
Yes, Holden Dealerships still have a range of new, demonstrator and used vehicles available for sale. If you are interested, you should contact your local Dealer while stock lasts.
Translation: You could, but that’d be a pretty crazy decision. Look for firesales closer to the end of 2020, but even then, understand what you’re buying.
The whole thing is a sad end to a famous brand and one thing is for sure.. the mountain will miss you Commodore.
Holden’s demise is partly the fault of the customer – for years many die-hard Holden fans demanded they keep producing a large RWD sedan, but the issue was when they did (no doubt at large expense), those same vocal people didn’t buy a new Commodore, they stuck with their 1999 VT and then bought an SUV or a small hatchback as a second car, but from a different manufacturer 🙂 Poorly made rebadge efforts from Daewoo didn’t fool anyone, and even if those cars had been semi-decent, the dealer network in many cases had no interest in keeping the customer looked after and feeling special. By the time Holden brought in reasonable (i.e. well built, safe, and modern design) cars, like the Astra, the image was tarnished, and people were shopping elsewhere.
You are on the money,unlike the unaustralian trolls who pretend to know about tech,let alone proven reliable products.truth is suvs perform most cases better than the german commy counterfiets,why australians woke up and realised it!
the issues with both Ford and Holden is they built cars cheaply, with inferior parts and built in obsolescence to boost their profits. Every time you took a holden back for the regular service there were a bunch of “worn out” parts that needed to be replaced at YOUR cost. Those with Toyota’s only ever paid for the service, because the quality parts never needed replacing.