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A race to the finish for Ford and Holden?

Paul Pottinger

by Paul Pottinger

16 Jan 11:59am

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Filed under: Cars, Commodore, Economy, Ford, Holden, Manufacturing, Sales

54 comments

Mark Twain had the bizarre pleasure of reading his own obituary. It would be a salutary experience.

So far the Falcon is set to finish first… Pic: Supplied

The obit for Australian car manufacturing, however, has the aspect of a soap opera. It’s been running for years with the same grinding inevitability and fading stars.

Rumours that the death have of those one-time Strayan icons –  Ford’s Falcon and Holden’s Commodore – have not in fact been exaggerated were confirmed today at the Detroit motor show. Once the champions in the two-horse race that was the local new car stakes, both nameplates will be sent to the knackery in 2016 (or at best be assigned to imported American models).

In the case of the Falcon particularly, the announcement is in the manner of a mercy killing. Though heavily subsidised and discounted it sputtered to a miserable 14,000 sales in 2012. The single best-selling model of the year, the ubiquitous Mazda3 small car, did more than 44,000.

Perhaps more tellingly, the fallen local hero was left behind by the Thai-made Ford Focus, an excellent small car festooned with clever equipment, imported under the free trade agreement.

Adieu too to the Territory SUV that is based on and built alongside the Falcon. Just as the Falcon is displaced by the Yank made Taurus, the only home-made SUV is deleted for the Explorer as Ford becomes a full importer.

It’s only slightly less surprising that the writing for the Commodore has moved from the wall to the tombstone.

The Commodore lost 25 per cent of its sales last year, slumping to a historic low of 30,000. This, coming barely after Holden said 320 jobs are in jeopardy at its V6 engine making plant, is hardly an auspicious introduction to next month’s new, more upmarket VF Commodore.

There is a sense of relief that the pretence is finally over. Certainly American auto executives won’t miss their annual Detroit hazing by Australian journalists determined to extract some crumb as to the future of cars assembled in Melbourne and Adelaide.

The question is, while this marks the end of something, does it signify the beginning of something else?

Holden has committed to local manufacture until 2022, but surely that is contingent on succeeding in the world’s most feverishly competitive new car market, one in which 60 brands vie for one million sales.

Holden will bolt together a second vehicle at its Elizabeth plant from 2017, almost certainly a compact SUV. But that market segment is almost as overpopulated as the small car area in which Holden’s respectable, but far from class-leading, Cruze lost sales last year.

If the odds are stacked against a buyer led recovery for Holden, it will be a courageous government of the day that forks over further taxpayer millions to subsidise the manufacture of cars that aren’t selling sufficiently. 

Then it will be a case administering the last rites.
Paul Pottinger is editor of News Limited’s Carsguide.

Comments on this post will close at 8pm AEDT.

Most commented

54 comments

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    • DCH says:

      11:29am | 16/01/13

      “world’s most feverishly competitive new car market” - how can that be when we have such major price discrepancies for identical models between our market and overseas?

      Reply

    • marley says:

      12:05pm | 16/01/13

      I think he just means that the smaller car sector is the most competitive one in every country on the planet, even Australia, and it takes something special to compete with the Japanese and others in that sector. Frankly, I don’t see Australian-built cars doing that.

    • Shane says:

      11:32am | 16/01/13

      The writing has been on the wall for years now, only delayed by government handouts. The Ford Falcon and Holden Commodore are both relics of a bygone age. Manufacturing quality is truly abysmal. Running expenses are excessive. We will never manufacture or export these cars in sufficient quantities to justify their existence. Even Kia makes better cars nowadays.

      Let the industry die. Invest the money in something that will create markets, jobs and incomes. Let’s look to the future instead of being stuck in the past.

      Reply

    • Paul says:

      12:14pm | 16/01/13

      @ Shane: In an election year do you really think the Government grants propping up the industry in the safe Labor seats of Calwell and Corio will cease?

      Especially given the proximity of both electorates to the Prime Ministers own of Lalor.

    • S.L says:

      12:27pm | 16/01/13

      Kia make better cars?
      Excuse me while I throw up!

    • Bigfazza says:

      01:56pm | 16/01/13

      Have you owned one of these cars, we have owned a new FG Falcon and a new Cruise. Both Australian built and both of a high build standard. The snobbery of many Australians is a large part of the problem.

    • seniorcynic says:

      02:24pm | 16/01/13

      The only justification for having a local car industry as I see it is so Australia has the capability to manufacture army vehicles in case of a war.

    • John A says:

      03:13pm | 16/01/13

      Shane,
      In reality we should never have had a car industry, this was and is all about politics, nothing more. Australia does not have the population to support a car industry and never has had. We could have bought all the cars we needed from overseas and had a far greater range from which to chose.

      Why in an island state we never put as much money and effort into building ships I’ll never know. We could even have put a clause into contracts that said our raw materials would be shipped by us.

    • Neil says:

      04:57pm | 16/01/13

      @Bigfazza

      The snobbery comes from the owners too. It’s a bit off putting when a lot of them act like they won a world war for Australia single-handedly. I mean they’re alright cars, but nothing amazing. And nothing says hideously overpaid year 10 dropout wanker more than a maloo.

    • acotrel says:

      05:21pm | 16/01/13

      @seniorcynic
      ‘The only justification for having a local car industry as I see it is so Australia has the capability to manufacture army vehicles in case of a war. ‘

      So that we can maintain a vestige of our mechanical engineering expertise of the sort which underpins the most successful economies, and is the real source of wealth after the bullshit stops.

    • acotrel says:

      05:23pm | 16/01/13

      @Bigfazza
      ‘Have you owned one of these cars, we have owned a new FG Falcon and a new Cruise. Both Australian built and both of a high build standard. The snobbery of many Australians is a large part of the problem.’

      Do the Chinese yuppies buy them, or do they prefer Audis ?

    • Ben says:

      05:50pm | 16/01/13

      I think Neil’s reference to a “hideously overpaid year 10 dropout wanker” takes first prize for snobbery.

    • Mattb says:

      05:54pm | 16/01/13

      Neil says: 04:57pm | 16/01/13
      @Bigfazza

      “The snobbery comes from the owners too. It’s a bit off putting when a lot of them act like they won a world war for Australia single-handedly. I mean they’re alright cars, but nothing amazing. And nothing says hideously overpaid year 10 dropout wanker more than a maloo.”

      Something tells me Neil cant afford a maloo and thus writes anyone that has one off out of sheer jealousy. Nothing says hideously judgmental wanker than what neil has written above and then he dares to accuse others of snobbery. I mean FFS, it’s a car, and if someone else likes it and you dont, build a bridge..

    • Modern Primitive says:

      11:36am | 16/01/13

      Ford and Holden didn’t change with the times, instead, doggedly stuck to the big country, big distances, big cars philosophy in a world where air travel competes with car travel on cost as well as time and convenience.

      Had they been engineering small, economical, fun to drive rear wheel drive sedans and hatches (BMW dynamics for a Toyota price) that appealed to a broad range of buyers, I don’t think they’d be in their current slump. I also think that turning group A touring cars into the two horse race that was V8 super cars contributed significantly to a bogans image that would have turned many buyers off.

      In the end, they haven’t been giving the consumer what they want, and are paying for it.

      Reply

    • Tubesteak says:

      12:23pm | 16/01/13

      Agree with this.

      Hopefully, now that we don’t prop up a “local industry” with taxpayer money we’ll see some price drops as the inflated local industry disappears.

      Then if we can allow parallel imports….

    • ramases says:

      04:41pm | 16/01/13

      Tubesteak, that Tax Payer money that you talked about went straight into the pockets of the workers but no gains in productivity. Why are we supporting these people who think they have a right to demand more and more for less and less. I said last year early on that Ford and Holden were doomed and was shouted down. Its not only the Unions but the hight cost of everything in Australia which add to the costs involved in building cars in this country. Imported cars are usually cheaper, have better warranties, come with more standard inclusions and on the whole better built that the local cars.

    • AdamC says:

      12:00pm | 16/01/13

      It has always struck me as bizarre that many of the same people who bitched about allegedly foreign-owned mining companies lobbying against getting slugged with a super profits tax were quite happy for taxpayers’ cash to be lavished on Tokyo and Detroit automakers so they would continue to locally assemble cars that nobody wants to buy.

      The Australian car industry has been on life support for ages. Even when our dollar was at 50 US cents local manufacturers were barely competitive. Australia just does not seem to have the industrial cultuare to support globally competitive heavy manufacturing. With poor local management decision-making and cowardly governments constantly prepared to bail the industry out, there is plenty of blame to go around.

      Reply

    • John Kearney says:

      12:01pm | 16/01/13

      Plastic, Glass, rubber and airbag was never going to sell.  I own a real car a 1963 EJ holden ute for work and a MERC 1988 560 SEL for taking the wife to dinner. The Merc is still envied by the enthusiast and the EJ is the talk of the jobsite. Why the hell would I want to buy a piece of S+++ thats neither practical, funtional and seriously over priced.  The beauty of owning a vehicle is fixing them when they are in need of repairs.  Teaching my kids to be self reliant when it comes to mechanical knowlege and knowing your driving real steel.  This wizz bang crap they build nowadays deserves to die,  Even the V8 racing is rubbish.  Everything is exactly the same,  makes for very boring racing.  Back in the day you could buy off the showroom floor what they raced at Bathurst,  It was the best and the cars were beautifully made. Now they dont even resemble there namesake. People are not interested in buying S+++ and want value for money.  You`d be lucky to see one of these new cars last beyond 5 years, yet we are forced to pay 50 grand for some bucket of crap you cant even work on !!

      Reply

    • camzhydro says:

      12:26pm | 16/01/13

      Wow john. You need to get with the times. My modern car has a 2l turbo and outputs more power than your merc and uses less fuel,  handles better and all the features. that’s the beauty old cars are hobbies and cost money. To compare a new car to an old one you are just a moron with a chip on your shoulder.

    • HC says:

      01:02pm | 16/01/13

      @camzhydro

      Yes but the repair costs on your car are astronomical.  A little duct tape, a wrench and a little grease and John’s cars will keep running for another 20 years.  Not only that in 20 years time your car will be looking naff, cheap and probably hideous (if it survives even 5 years) while John’s cars will be as timeless and as stylish as the day they rolled off the assembly plant.

      And what percentage of all that power in your little turbo four-pot are you using?  10%?  Less?

      And John I’ve always preferred the 560 SEC, it was my first Matchbox car smile

    • Rstar says:

      02:29pm | 16/01/13

      Haha John, do you sit on your front verandah in a rocking chair with a shotgun telling the young punks to stay off your lawn too?

      Today’s cars are an improvement in every single way over your old ute and Merc. Practicality, functionality, safety, reliability, power, economy, all these things are better in current cars. It’s time to stop living in the past you old fart.

    • simonfromlakemba says:

      02:57pm | 16/01/13

      560 SEC love that car. From the update 1988 onwards, beautiful.

    • acotrel says:

      05:32pm | 16/01/13

      I’ve had many Australian cars .  I now drive a Ma zda 6 which has a 6 speed manual box.  I actually enjoy driving it - a new experience for me. It was obviously based on a rally car not lurchers which have had specialised races provided for them.  If Holden and Ford really raced their cars in open classes, their product might be substantially better. V8 Supercars are bullshit !

    • Edward James says:

      12:02pm | 16/01/13

      They were taxpayer handouts, funded by me and you, for cars which had never really been Australian. In 2013 cars are are nothing more than global platforms of one sort and another. Tell the car industry NO pi$$ off!  We Australians have the engineering nouse and the resources and means to build our own vehicles powered with our natural gas not petrol!  Oh dear that is not politically palatable on the international stage. Well who are our politicians representing ?  Edward James

      Reply

    • Edward James says:

      12:02pm | 16/01/13

      They were taxpayer handouts, funded by me and you, for cars which had never really been Australian. In 2013 cars are are nothing more than global platforms of one sort and another. Tell the car industry NO pi$$ off!  We Australians have the engineering nouse and the resources and means to build our own vehicles powered with our natural gas not petrol!  Oh dear that is not politically palatable on the international stage. Well who are our politicians representing ?

      Reply

    • S.L says:

      12:38pm | 16/01/13

      Why won’t people buy local? Well let’s compare prices.
      When the “new” Monaro was released here it cost around $60k. When the Pontiac GTO (same car and made here)  was released in the USA it cost $28k with our dollar near parity with the Greenback. Why?
      Compare luxury European Car prices locally and O/S (even without our luxury car tax) it’s just ridiculous!
      Are we being ripped off to the detriment of local manufacturing? You bet!

      Reply

    • Richo says:

      02:46pm | 16/01/13

      That’s right, it just shows how much markup there was on the car in Australia when they shipped it to the USA and sold it for a profit at $28k. Just another example of Australian retail rip-off. It’s an injustice that the two big Chev icons - the Corvette and Camaro are not imported by Holden. Maybe they could build those cars here.

    • S.L says:

      04:00pm | 16/01/13

      @Richo you might not be aware but the new Camaro sits on a VE Commodore based chassis….......

    • elhombre says:

      06:28pm | 16/01/13

      I’m driving a supercharged 4.2L Jaguar XF here. Aussie sticker price was $167,700. I paid $34,000. I like the Falcons and when I come home will buy one (maybe a 12 month old model) and will just have to accept that it is overpirced.

    • Harquebus says:

      12:40pm | 16/01/13

      Peak oil mates, peak oil. The deaths of the automotive and aviation industries is inevitable.

      Reply

    • Anubis says:

      02:47pm | 16/01/13

      Welcome back Harquebus. Mate, where would we be without you reminding us about peak oil every time you post?

    • stevem says:

      02:48pm | 16/01/13

      That’s the thing that keep occurring to me when they say Sydney Airport will be full in 2025.

    • Simon M says:

      01:05pm | 16/01/13

      Ford lost the plot when they didnt try to push Australian made cars overseas (Think what Holden does) and rejected making a small car (Focus) here in Australia. Add to that that the falcon platform is arguably better than the current mustang platform, and the two cars could have shared the platform (again think GMs global platform sharing) so Ford for commited comercial suicide

      Now Holden correctly as stated in the article do have the cruze, but it is only one model and not as good as other class leading vehicles in this class (Think VW Golf) They lack a performance model of which the Germans, French and others have had in this segment for years, and HSV ignores this segment as well, thinking all buyers just want huge V8 sedans.
      What Holden shopuld have done is remake a modern Torana, a BMW 3 series sized car with V6 power (Turbo’ed for the top performance model) and a 4 Cyl for lesser models at a reasonable price

      I agree with the above comment of turning the Touring cars series into the V8 super cars, for years now it has been boring, with only the two similar sized, same egined cars racing. It appeals to a certain percent of the Market (those who continue to buy Commodore/Falcon) But to a lot of others it has lost all apeal that the earlier series had. Its definatley a step in the right direction to allow Nissa & Mercedes in to play. It will be interesting to see what the series will look like after 2016…

      I womt be mourning the loss of either car, and welcome the introduction of cars like the Focus ST. Now all I’m waiting on is a reply from Holden…

      Reply

    • IJ says:

      01:05pm | 16/01/13

      Being in the automotive repair business and repairing all makes and models,  people to be rubbishing the Ford and GM product obviously haven’t driven or own one. Sure, 6 cyl engines use a small amount of fuel more than a 4 cyl but that is easily swallowed up by the much higher spare part and servicing costs. A small car will never ever be able to compete with the comfort of a larger car particularly the type of roads we are seeing now days.

      Reply

    • Kev says:

      02:31pm | 16/01/13

      Perhaps you’re correct perhaps you’re not. These sales figures don’t lie. If people aren’t buying them then there must be something wrong.

    • Dave-o says:

      01:09pm | 16/01/13

      Referencing an article by Joshua Dowling on the death of the Falcon. Does that guy actually write about anything else?

      Reply

    • Mark Out West says:

      01:29pm | 16/01/13

      How STUPID are Aussies, get rid of an industry that supports 600,000 jobs and watch your taxes sky rocket to pay the unemployment and social fallout.
      YOU rallied against the mining tax which would have subsidised these industries until the dollar fell to the normal levels and we will be competitive again.
      Lets all follow the the conservative BULLSH*T and put to the stake all those jobs, maybe the dunder clumpens on this page will want to work for African wages for the mining Billionaires I’m sure they will appreciate it.
      No hang on the 600,000 extra unemployed will now do it, good thinking GENNA.

      Reply

    • Bho Ghan-Pryde says:

      02:43pm | 16/01/13

      Mark Out West, says “subsidised these industries until the dollar fell to the normal levels “. Well Mark I am pretty sure these industries were subsidised even when the dollar was less than half what it is. The thing with subsidised industries is they never seem to get over the need for the subsidy.
      But in any case you will get your susidy. Do you really think it is a coincidence this has been raised only months from the next Federal election? Of course it isn’t, and yes the subsidies will roll as there are some majinal seats in the balance.

    • Bho Ghan-Pryde says:

      02:43pm | 16/01/13

      Mark Out West, says “subsidised these industries until the dollar fell to the normal levels “. Well Mark I am pretty sure these industries were subsidised even when the dollar was less than half what it is. The thing with subsidised industries is they never seem to get over the need for the subsidy.
      But in any case you will get your susidy. Do you really think it is a coincidence this has been raised only months from the next Federal election? Of course it isn’t, and yes the subsidies will roll as there are some marjinal seats in the balance.

    • Tubesteak says:

      03:32pm | 16/01/13

      If every industry genuinely supported as many people as it claims it does Australia’s population would be about 80,000,000 people.

      The people can either retrain, move to a country that wants their skills (at local labour rate) or be unemployed.

    • Mark Out West says:

      05:56pm | 16/01/13

      Bho Ghan-Pryde there is a difference between co-investment and subsidies.  You co-invest with companies who bring their technologies to you so that you can both implement them and reap a benefit, ie car industry.
      Subsides is where you support the company financially to keep it going through a difficult time for the benefit of both.  All ventures have risk and this is the down side of that risk.
      Nah lets just mine the CR*P out of Australia and see the Billionaires bail out to other countries (Packer - Asia, Murdoch - America) and then you can figure out what we do next?????

    • kfr says:

      02:16pm | 16/01/13

      Ford want out of Oz as a maunfacturer based on cost alone. Do not blame them for that. Look at the number of mercs, audis, bmws & now french imports on out roads. Cheaper to build o/s and ship in. If we can afford to buy imports we will buy imported fords. Remember the cries when nissan closed its car plant 2 decades ago here? NO! Did we stop buying nissans? No! Will we buy fords? Yes! Will there be sports car racing? Yes! It will be like the 1970s with differing classes of car competing and actually look like what we buy & drive these days.Do i drive a new ford? Yes. Do i like it? Yes. Just do not like the bogan gts these days, look shit but go like it.

      Reply

    • Rstar says:

      02:24pm | 16/01/13

      I personally can’t wait until these outdated Falcodore boganmobiles die out.

      Reply

    • Marco says:

      02:43pm | 16/01/13

      I’m laughing here at the commenters who suggested that what Holden and Ford should have done was build a smaller RWD car - “BMW dynamics at a Toyota price”.  Let’s look at how many small to medium RWD cars currently compete in mass market segments worldwide:


      None whatsoever.  Why?  Because every car company knows that they would get killed on cost and space efficiency by every other car maker selling FWD cars in the same segment.  Sadly, it appears that the same is now true for larger cars as well.

      We have been lucky to have our own two large RWD cars for as long as we have.  We won’t appreciate what we’ve got until it’s gone.

      Reply

    • stewart says:

      05:28pm | 16/01/13

      Did you happen to see what wheels car of the year was before posting this ?

    • Ian says:

      03:00pm | 16/01/13

      I think most australians are smart enough to know your figure of 600 000 jobs supported by this industry are grossly exagerated. The figure in the entire industry is actually more like 329, 000, however this includes industry sectors such as automotive retail, fuel, parts and supplies and the support industries, most of which is not reliant on the australian automotive manufacturing industry. The figure involved in the actual manufacture is more like 40, 000 people. The source of this information is a manufacturing skills australia and provides very accurate details on this.

      However, 40, 000 people is still a lot of people to be out of a job, as in my opinion having even one person lose a job has significant socio-economic impacts, and rather than propping up an industry that is currently dying, a more efficient use of government resources would be developing a transition plan to keep these workers employed elsewhere when current manufacturing has ended.

      I do absolutely agree with you that the erosion of terms and conditions must be stopped immediately, as this is getting out of control and is happening in many industries. The cause and possible solutions are outside the scope of this reply, but make interesting reading if you wish to pursue it.

      Reply

    • Greg says:

      03:31pm | 16/01/13

      Falcon and Commodore are great cars that are relatively efficient (compared to medium sedans and small/medium SUVs). Drive one, read a review, this is true. The problem I feel is public perception of a dated gas guzzler and dated designs (Commodore is 6 years old and Falcon 5 years.

      The major Commodore upgrade (VF) will arrive in a few months with big improvements in fuel economy and technology, not to mention fresh styling.  The test to see if there’s life in this type of car will be how well VF sells.

      Reply

    • David of The Grand Academy of Adelagado. says:

      03:43pm | 16/01/13

      Why aren’t we making a genuine ‘hard as nails’ 4WD cab/chassis to compete with the landcruiser/hilux etc. It doesn’t have to be stylish or luxurious. It just has to be tough, reliable, cheap and a little bit comfortable. You see thousands of these utes/traytops on farms and worksites when you get out of the city but Aussie car builders don’t seem interested. Now even the Chinese with the ‘Great Wall’ range are pinching that market from us. Surely we could put something together from existing components produced by Ford and Holden.

      Reply

    • charlie says:

      04:28pm | 16/01/13

      “I personally can’t wait until these outdated Falcodore boganmobiles die out.”
      “bogans” can’t even afford new falcons and commodores your logic is flawed.
      i work for bmw and prefer a falcon for build quality and fuel efficiency. to get anything as good as an FG falcon in the bmw range you have to spend $150k+ compared to 30k for the falcon and with the bmw you are getting less reliability.
      Ford and holdens main problem is their marketing hasn’t yet hit the spot getting through to dullards like most of the people commenting here that their cars although a little dated in styling a as good if not better as imported crap for engineering.
      but too late now the damage is done i might as well join the bandwagon
      BAN THE BOGAN CARS HERP DERP

      Reply

    • marley says:

      06:18pm | 16/01/13

      Look, the reality is, many, many Australians don’t want big cars.  They live in cities, they commute to work, they do stop and start driving, and the Falcodores simply aren’t the best cars for that. 

      The problem is not Ford and Holden not getting their marketing across; it’s that Ford and Holden haven’t been listening to what the market actually wants.  It really doesn’t matter whether their cars are better (which I think is pretty arguable);  what matters is they’re trying to back Beta (a better system) against VHS (look it up) and the buyers want VHS, not Beta.  At some point the companies have to throw in the towel and admit they’re not building what people want to buy.  That’s actually pretty basic business strategy.  Why do you think Billabong is in so much trouble? They didn’t listen to what the customers were saying.  Ford and Holden, pretty much the same.

    • Steve the car salesman says:

      04:35pm | 16/01/13

      Wow there is a lot of misinformed people here. Last year we sold 1.2 million cars here in Aust. The Yanks sold more than that every month….we pay our workers $30 per hour the yanks $15 hence their cars are cheaper! We currently have 65 different makes being sold in Aust the yanks 33. Would I rather be in an accident in an old car or a new one…i will take the new one everyday. At the end of the day the cars people want now are not 6cyl passenger cars. This has nothing to do with the quality of what we build just the type that we build. I personally feel sorry for the auto workers and supppliers who in 3 years are not going to have a job.

      Reply

    • Gordon says:

      04:35pm | 16/01/13

      Seeing as how we are paying subsidies to keep the auto workers on, effectively as pets, why don’t we have them build windfarms (another field where, despite different subsidies, we are losing contracts to OS) while they get trained up to build rooly good submarines. 

      I drove a Taurus in the US. Worst car I’ve ever driven. If this is what they plan to import instead of Falcons they can just forget the whole thing.

      Reply

    • ramases says:

      04:51pm | 16/01/13

      You are certainly a funny person, wind farms, it is to laugh, subsidised effigies to the Greens that have about as much chance of supplying power on a permanent basis as Gillard telling the truth. As for rooly good submarines ours are rooly good they can submerge….............................

 
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If you want a festival for older people or for families alike, get amongst the respectable punters at Bluesfest. A truly amazing festival experience to be had of ALL AGES. And all the young "festivalgoers" usually write themselves off on the first night, only to never hear from them again the rest of… [read more]

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