17 Feb 20

Australian Motoring Icon Holden to be wound down

General Motors has announced the retirement of the Holden brand with all local design and engineering to be wound down by the end of this year.

Holden has long been a stalwart of Australian fleet sales and through most of the late 20th Century held the number one spot for sales in Australia. In October 2017, they rolled off the last locally produced vehicle and have struggled to find a market since.

GM Imports Couldn’t Replace Australian Made

After the closure of the last plant in Elizabeth, South Australia, Holden focussed on badge engineered imports from the GM stable but were not able to attract Australian buyers. In 2002 the brand peaked with almost 180,000 vehicles sold, finishing the year in number 1 spot for sales, but 2017 saw them move just 90,000 vehicles to finish in 4th place behind Toyota, Mazda and Hyundai.

2019 saw Australian new car sales fall by 8% but it was truly a horror year for the Holden brand. Sales fell by nearly 30% to just over 40,000 vehicles, leaving a once proud manufacturer in 10th place overall.

Finance and Mobility Businesses in Limbo

GM’s announcement indicated that Holden Financial Services and Maven – the group’s mobility and car-sharing business, will also be wound down. Both businesses will have valuable financial assets but at this time there is no indication whether these would be sold off or wound down.

Maven has had a troubled start in Australia, after being founded in the US when GM acquired the Sidecar business in 2016. Their business includes Maven Gig, specifically for drivers in the gig economy, as well as the car share business.

Holden Financial Services has largely served the consumer business with Fleet Management needs being handled by the Holden Leasing brand under licence to ASX listed McMillan Shakespeare (ASX:MMS). It’s not yet clear whether this business will also be wound down as a result of the announcement.

Fleet Operators Changing Needs

To a large degree the demise of Holden can be slated back to the changing needs of fleet operators. Through the 90s and early 2000s, the fleet choice generally came done to which of the four locally produced full-size sedans was preferred. All were six cylinder and able to seat five adults.

More recently, there has been a push toward smaller vehicles and SUVs and the top ten selling models does not include a single full-size sedan.

End of an Era

Holden Managing Director Kristian Aquilina has acknowledged the significance of Holden’s history in Australia and called for a “dignified and respectful wind-down”.

Holden have advised that they will continue providing servicing and spare parts for at least 10 years and will maintain a national aftersales network in Australia and New Zealand.

Article authored by Shane Curran

Authored by: Yves Helven