Holden posts its second-biggest financial loss on record as it winds down manufacturing

[Dr Smith]

http://www.heraldsun.com.au/business...-1227446008764

It means Holden has been in the red for eight of the past 10 years, posting only modest profits in 2010 ($112.4 million) and 2011 ($89.7 million).
The result wasn’t as bad as Holden’s previous year’s loss of $553.8 million, and was driven largely by redundancies and other costs linked to the 2017 closure of its car assembly line in Elizabeth in South Australia and the engine factory in Port Melbourne.
The result includes $345.9 million in “employment separation charges” and $9.36 million in asset writedowns.
Once costs associated with the factory shutdowns are excluded, Holden’s operating loss was $5.6 million in 2014.

However, the car maker received $80.8 million in government assistance, without which the financial loss would have been much higher.

I love the comment posted below the article and I've copied it to here:

Hey Joshua, your article about Ford's losses printed on 22 May had the following heading: "Ford Australia posts $191 million loss: in the red by a staggering $1.3 billion over 10 years". How come you haven't listed Holden's total losses in the same period or used the same emotive form of Headline in today's article. If Ford's losses are described as "staggering" and Holden has obviously made far greater losses even after almost double the Australian governments handouts then Holden's losses should be more like" Diabolical"? And let's not forget Holden easily sold far more vehicles then Ford in this same 10 year period!

So it sold more, was gov. granted more and made greater losses yet it's Ford which is the more staggering loser.

[ford man xf]

Which ever brand you affiliate yourself with, this is sad news, it's still hard to imagine the Australian auto industry without the Falcon or Commodore :-(

[buggerlugs]

The comment seems to have been "Deleted".....funny about that.........

[Dr Smith]

True and any Australian job losses are terrible. I wanted to highlight however Dowling in this case clearly hasn't written "apples with apples". The difference is obvious in his thoughts between the two brands with his language towards Ford being more derogatory yet it's Holden which has done considerably worse financially particularly considering its double sized hand outs.

[ford man xf]

Ford Australia have been smart in a way that they lowered their R&D costs and also dropped a number of low volume selling models for the Falcon such as the wagon.

Shame that the EcoBoost just came a bit too late for them, had this entered service in the Falcon around the BF / BF 2 series who knows how many more they may have sold.

[39ClevoUte]

Righting down all those losses is sure to be a tax deduction. All part of sucking out max money from our economy as they change bussiness models.

[mik]

Originally Posted by ford man xf

Which ever brand you affiliate yourself with, this is sad news, it's still hard to imagine the Australian auto industry without the Falcon or Commodore :-(

and sad news we will have no more big car manufacturers full stop.

[Sprintey]

I think Nissan will still be making components in Dandenong Mik, including for their EV's or Hybrids.

Nissan... Australia's own.

[naddis01]

Originally Posted by ford man xf

Shame that the EcoBoost just came a bit too late for them, had this entered service in the Falcon around the BF / BF 2 series who knows how many more they may have sold.

Probably about 10 more than they have sold to date. No one knows about them and those that do are too ignorant to recognise the benefits.

[danzvtil]

“employment separation charges”
And tell me why industry isn't falling over itself to set up shop here and replace automotive manufacturing in this country.

[1TUFFUTE]

Originally Posted by Dr Smith

http://www.heraldsun.com.au/business...-1227446008764

I love the comment posted below the article and I've copied it to here:

Hey Joshua, your article about Ford's losses printed on 22 May had the following heading: "Ford Australia posts $191 million loss: in the red by a staggering $1.3 billion over 10 years". How come you haven't listed Holden's total losses in the same period or used the same emotive form of Headline in today's article. If Ford's losses are described as "staggering" and Holden has obviously made far greater losses even after almost double the Australian governments handouts then Holden's losses should be more like" Diabolical"? And let's not forget Holden easily sold far more vehicles then Ford in this same 10 year period!

So it sold more, was gov. granted more and made greater losses yet it's Ford which is the more staggering loser.

That comment sounds like exactly what I've been saying for ages around here...responding to Joshua's dribble, and some of his little elves that run around here sometimes!
But it wasn't me this time I swear

[Crazy Dazz]

Hmmm...

Call me cynical, but it seems to me that local subsidiaries of global companies are forever "losing money."
So WHY are they still here???

I'd guess that the majority of the cars they sell now are imported, yet surprise surprise, they keep losing money!?! So again, why keep selling them?

I've worked (as an accountant and finance manager) for multi-nationals, and its the oldest trick in the book. Transfer prices, corporate R&D, management fees, licensing fees, all used to ensure that profits are channelled to head office and lower taxing countries.
It also helps when you're chasing government help and tax concessions!

[zilo]

Originally Posted by Sprintey

I think Nissan will still be making components in Dandenong Mik, including for their EV's or Hybrids.

Nissan... Australia's own.

they just sacked a lot of people.

[Express]

Originally Posted by Crazy Dazz

Hmmm...

Call me cynical, but it seems to me that local subsidiaries of global companies are forever "losing money."
So WHY are they still here???

I'd guess that the majority of the cars they sell now are imported, yet surprise surprise, they keep losing money!?! So again, why keep selling them?

I've worked (as an accountant and finance manager) for multi-nationals, and its the oldest trick in the book. Transfer prices, corporate R&D, management fees, licensing fees, all used to ensure that profits are channelled to head office and lower taxing countries.
It also helps when you're chasing government help and tax concessions!

I’ve work for a few Multi-Nationals and I’ve been saying the same thing for years.

Why?

Because I’ve seen it first hand is why.

These car Companies aren’t as mad as what some people think, if they were just local businesses relying on turning a profit they would have pulled out years ago but profit isn’t the primary motivation and add that successive governments kept throwing huge never ending grants at them for the employment opportunities they offered, they were laughing.

Why has that now changed?

When the parent companies come under pressure to compete globally at home and abroad as is now the case with the big three Americans, they can’t afford to have piece meal operations all over the world and therefore streamlining, cost reduction and one make strategies comes into play.

The car companies would have forecast this years ago and have long been working towards this day.

No one at Holden or GM will be having a haemorrhage over these financial figures.

[LoudPipes]

I’ve also been witness to this type of practice in my working life and I’m sure many other members have as well.

Governments all over the world allow these types of concessions to win investment.

Stifle business and you kill employment.

[JAJH]

There is something fundamentally wrong with Government thintkng in this country. We have lost 2 of the biggest manufacturers, staff and all the associated industries yet we continue to allow cheap imports into the country. If the powers-that-be were genuinely interested in protecting business and other interests, they would take measures to make sure large industry was safe and not encourage overseas makers to flood our markets and as a consequence large chunks of money going off shore.

[Dave R]

So many people running around saying the govt is wasting money assisting our industry, oh look they gave Ford and Holden handouts and they still lose money. Try designing and building a car here, then sell it against cheap as trash imports AND make money on it. Then we'll write a bunch of articles about how much money the poor bastards are losing here. But as long as you save a few grand on your garbage Corolla that's all that matters

[Dr Smith]

Originally Posted by Adrenaline

So many people running around saying the govt is wasting money assisting our industry, oh look they gave Ford and Holden handouts and they still lose money. Try designing and building a car here, then sell it against cheap as trash imports AND make money on it. Then we'll write a bunch of articles about how much money the poor bastards are losing here. But as long as you save a few grand on your garbage Corolla that's all that matters

Often misunderstood is that anything granted by government was matched at upto triple by the actual companies. Hate to think what unemployment benefits and all other potential welfare and social costs would have been compared to paying grants to the companies in the same time frame. Not to mention the wages tax paid and gst spent by the workers.

[39ClevoUte]

Balance of trade comes into this as well. When you sell someone billions and billions of $ worth of something, eg iron ore and coal etc etc. What can you do with their money? Money is just an IOU.
You have to open trade to the buyers country, so you can use their money to buy stuff off them. You are simply swapping. Yes you swap currencies with other countries but only if they want to buy something from them.
The same works in reverse. If the balance tips in their favour, then what do they do with all those Aus $, they can only use them here, do we make much that they want...no. But we have land, houses, farms, businesses etc.
So next time you buy a foriegn car remember you just handed someone an IOU and they will come back one day to spend it.

[XRtowcar]

Cant help thinking that creative accounting adds additional expenses to their loss to deliberately inflate the numbers.
Remember profits get shifted off shore and better to make a profit in their homeland than in Australia.
And you cant ask for a handout if your making a profit.
As for Holden coming out of this post Commodore, it will be ugly if they think they will do it with Korean products inferior to what Hyundai/Kia already have.

[Kieron]

Originally Posted by Adrenaline

So many people running around saying the govt is wasting money assisting our industry, oh look they gave Ford and Holden handouts and they still lose money. Try designing and building a car here, then sell it against cheap as trash imports AND make money on it. Then we'll write a bunch of articles about how much money the poor bastards are losing here. But as long as you save a few grand on your garbage Corolla that's all that matters

Utter garbage Corolla and your footer says a person is a moron if they don't acknowledge the merits of competitors?

Investing money (in this case govt money) looks at opportunity, spend it on a local car industry and it keeps x amount of people employed in that industry and supporting companies but it returns a loss for that industry. Spend the same money on another industry where it also keeps x amount of people employed but it returns a profit Is surely a better option?

Ignoring the govt money for a sec, Ford and GM were both stopping unique car design/production in Australia. In Fords case, that's what Alan Mullalys One Ford was about, GM were a little slower so it didn't matter what the govt here did.

[Express]

Originally Posted by Kieron

Utter garbage Corolla and your footer says a person is a moron if they don't acknowledge the merits of competitors?

Investing money (in this case govt money) looks at opportunity, spend it on a local car industry and it keeps x amount of people employed in that industry and supporting companies but it returns a loss for that industry. Spend the same money on another industry where it also keeps x amount of people employed but it returns a profit Is surely a better option?

Ignoring the govt money for a sec, Ford and GM were both stopping unique car design/production in Australia. In Fords case, that's what Alan Mullalys One Ford was about, GM were a little slower so it didn't matter what the govt here did.

What other profit making industry is the current government investing in?

I know it’s not wind power.

I understand why the Yanks pulled the manufacturing pins but I don’t know why the Government didn’t fight to the death to stop them.

In fact the government couldn't wait to roll over quick enough.

An industry like car manufacturing was ideal for investment regardless of it turning a profit or not, the on flow of business opportunities related to it offered many many positives including retaining a much needed skill base.

[Kieron]

Originally Posted by Express

What other profit making industry is the current government investing in?

I know it’s not wind power.

I understand why the Yanks pulled the manufacturing pins but I don’t know why the Government didn’t fight to the death to stop them.

In fact the government couldn't wait to roll over quick enough.

An industry like car manufacturing was ideal for investment regardless of it turning a profit or not, the on flow of business opportunities related to it offered many many positives including retaining a much needed skill base.

You invest in what you do best, in our case that's mining where we actually sell to other markets and bring money into Australia and there is huge flow ons in this industry to other businesses. Farming Is another industry we do well in. We do not do large scale manufacturing well hence us not making TV's, white goods etc for a long time.

The Aussie govt is completely ineffectual against large global companies like GM, ford and Toyota. The former two were fighting for survival not that long ago, cutting costs where they could, including shuttering manufacture and shedding thousand of jobs in their home country so aren't going to listen to our pleas.

Certainly, the Aussie govt couldn't wait, they could see the writing on the wall and as I mentioned, they see using the money elsewhere ultimately gives a better return.

[PHawk]

Demise of the Aussie Sedan is very sad indeed, even for us in NZ we have grown up, live with and even lived in our Fords and Holdens, it will be a sad day when they are on longer around, I'm glad I was around when we drove Falcon & Commodore :o(

[Pedro]

I think we've lost track a bit here. The OP was about the one sided writings of that tool Dowling.

[PHawk]

Originally Posted by Pedro

I think we've lost track a bit here. The OP was about the one sided writings of that tool Dowling.

I'm just having a weep moment! A little to much Laphroaig

[Chopped]

Maybe Holden just has more creative accountants.

[Dave R]

Originally Posted by Kieron

Utter garbage Corolla and your footer says a person is a moron if they don't acknowledge the merits of competitors?

Read it again, more slowly. It's a quote referring to people who dismiss an otherwise good car because it isn't wearing their favourite badge. Nothing to do with people disliking a car for genuine reasons. Corolla is garbage, drive one and you might agree. Or maybe you'll love it. Either way I don't really care

[russellw]

It means the combined loss for the three local manufacturers this last reporting year is $883.2m and over the last decade it's been $1,832m and even over the last 15 it's been $66.7m.

Individually, Ford have lost $1,104.8m over the last 10 years and $759.4m over the last 15 years.

Holden have lost $1,337.8m over the last 10 years but only $66.6m over the last 15 years.

Toyota have made $619.6m over the last 10 years and $759.3m over the last 15 years.




Cheers
Russ

[LoudPipes]

Originally Posted by Kieron

You invest in what you do best, in our case that's mining where we actually sell to other markets and bring money into Australia and there is huge flow ons in this industry to other businesses.

And what a volatile market it is, we live and die at the mercy of the Chinese economy.

Talk about having all your eggs in one basket.

We export our natural resources and buy it back as product.