Holden will cut 500 jobs across its manufacturing and product development operations just one month out from the start of production of the new VF Commodore.
A total of 400 workers from the Adelaide plant and 100 “hourly paid” engineering staff in Port Melbourne will first take part in a “voluntary separation program” before August this year.
The decision comes as Holden both faces less-than-forecast demand of its Cruze small car, and expects only a small upturn in sales of its forthcoming VF Commodore large car.
The latest round of job cuts follows Holden’s announcement in late 2012 that 170 jobs would go at its Adelaide plant. Within six months, the size of the workforce at the plant will be reduced from 2250 to 1680 workers, while production numbers fall from 400 cars per day to just 335 cars.
It is the biggest round of job cuts since the Global Financial Crisis in 2009, matching the 500 redundancies made by Holden in July 2009 in the wake of the GFC and the ceasing of Commodore exports to the US following the GM shut down of Pontiac.
Holden managing director Mike Deveraux said in a media conference that while cutting the workforce is “obviously not a decision we make lightly”, he reinforced that “we have to make sure that we have an efficient and effective company”.
He described the drop in Cruze volume as reflective of the “vicious” pricing in the small car segment and the number of competitors in that class. While Devereux said that he expects the Holden VF Commodore to see an uplift in sales, he does not expect to see a sizeable increase in volume. A circa-6000 car VF Commodore export program to the US in 2013 pales alongside the approximate 35,000 VE Commodores shipped to Stateside in the Pontiac export program. The Police Patrol Vehicle (PPV) export program to the US is also yielding less-than-expected volume results.
Devereux believes that Holden has not broken any promise with the Federal or Victorian and South Australian governments to not cut staff.
Holden is targeting production of 74,000 units annually from its Elizabeth manufacturing facility in Adelaide, South Australia.
