Holden Safe Despite GM Bankruptcy
Friday June 5, 2009
As expected, US car giant General Motors filed for Chapter 11 bankruptcy protection in the US last night. The news follows after long running financial struggles in the massive US auto industry that both directly and indirectly employs a huge workforce. Here in Australia, Holden also accounts for 6000 direct jobs.
However, Holden in Australia has been guaranteed to continue to manufacturer and maintain operations in the Asia Pacific region, and company directors even state the company is well positioned to take advantage of future upturns. While the GM collapse will no doubt affect Holden and parts suppliers Pacifica, Holden will be around for some time yet.
Holden has taken all necessary steps to weather the economic downturn, including cutting employee shifts and pay cuts across the board. Holden also states it is in position to be a future economic hub in emerging regions along with China and Korea, which is good news and a relief for the 6000 Holden employees.
Chapter 11 bankruptcy is basically a call for the US government to inject even more fund into the ailing companies, which will add to a total of US$50 billion dollars. In return, taxpayers have 60 percent ownership in the company. Chrysler also filed for Chapter 11 bankruptcy and is expected to come out of bankruptcy within weeks.
According to Holden, no operations outside the US will be affected by the court rulings, and Holden will still remain a part of GM. GM's British Vauxhall and German Opel subsidiaries will not remain a part of the company.
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