Magazine of Socialist Action in Australia

Final nail in the coffin for Holden

Reading Time: 3 minutes

In February General Motors announced that it would retire its iconic Holden car brand, and close down all of its Australian operations. Some 600 workers are now set to lose their jobs.

While Holden had already announced an end to their Australian manufacturing operations in 2013, the latest news was seen as the final nail in the coffin of a company that employed tens of thousands of unionised workers over many decades.

Holden started as a saddlery back in 1856 and began manufacturing car bodies in the early part of the 20th century. The firm made its first full car in Australia in 1948 and for almost 70 years produced a whole series of unique, top-selling cars for the local and international market.

But from the 2000s free trade deals and a stronger Australian dollar began to impact on the company’s profitability, and they started to lay off workers. Both Liberal and Labor governments dished out huge subsidies to prop up Holden’s profits, and to try and discourage them from shifting production offshore.

But the company never had any particular commitment to Australia. They were engaged in a race to the bottom and they slowly shifted their operations to whichever country offered the best conditions for exploitation.

In 2013 the company admitted that it had received more than $2 billion from various Australian governments, most of which was transferred back to its US head office. While Holden’s business model was reliant on corporate subsidies, there was never any requirement for them to guarantee jobs, wages or working conditions. It was one big rort.

The 2008 global financial crisis put major pressure on the entire car industry and Holden used the opportunity to put its hand out for even more taxpayer-funded subsidies. They pocketed tens of millions extra only to announce in 2013 that all of its Australian manufacturing operations would close.

Only a skeleton staff of engineers, designers, salespeople and service technicians would remain. This latest announcement means that most of those jobs are now also being scuttled. The impact the job losses have had on workers and particular communities around the car plants has been immense.

Many of those who lost their jobs never worked again. Those that were able to find alternative jobs mostly found themselves in insecure positions, on much lower pay.

It’s true that the company has recently suffered from the US-China trade war, and from low sales in Australia, but what perverse logic says that highly developed manufacturing plants and tens of thousands of skilled workers should be scrapped because not enough profits can be made?

The company itself showed that it could be retooled to manufacture alternative products during World War Two when it diversified to supply the war effort.

In 2012 The Socialist commented: “Obviously it is no solution to just let the car industry wither on the vine. The factories are highly innovative and the workers are highly skilled. It would be madness to not utilise those resources. For example, we desperately need more trains, trams and buses in order to improve strained public transport systems. Car plants could easily be retooled to manufacture public transport vehicles, but instead thousands of skilled workers are being thrown on the scrap heap.”

The 2012 article continued: “Instead of accepting the logic of a system that puts profits before all else, the trade union movement needs to be fighting for a different way of organising production. Workers and unions alike should be campaigning to bring the big car companies into public ownership under democratic control. If the car companies were run on this basis they could be quickly retooled and used to produce things that we need. This would not only save jobs but if we began producing public transport vehicles it would also be good for the environment.”

A key take-away from the tragic demise of Holden is that it didn’t have to be this way. It was the logic of capitalism that killed this company and ruined the lives of thousands of working families. A socialist system would operate on a completely different set of principles.

Socialism would have utilised everything good that Holden built up over the years, but produced things in such a way that prioritised working people and social gains for all.

By Anthony Main


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