BMW slammed for anti-Holden comments

Union officials and industry experts have slammed BMW’s claim that “the writing is on the wall for Holden” as a kick in the teeth for Australian workers.

The boss of BMW Australia, Phil Horton, told journalists at a lavish launch of a new convertible in Cairns on the far north Queensland coast that it didn’t make sense for Holden and Ford to build cars in Australia and all but recommended people buy Hyundais instead.

“It makes no logical sense for Ford and Holden to have a manufacturing operation in a country like Australia ... You also have the extra dimension of people like Hyundai making very good cars,” he said.

“This is a real kick in the teeth,” said the SA secretary of the Australian Manufacturing Workers Union John Camillo. “Our workers are fighting for their livelihoods, trying to save the manufacturing future of Holden. They’ve agreed to wage freezes and helped the company cut production costs.

“To have some outsider comment on Holden like that is just a raw deal. It’s a bit rich considering BMW would also get a level of taxpayer support for its manufacturing operations around the world, just as every car manufacturer does.”

Mr Camillo added: “Comments like those from the boss of BMW Australia are not helpful to the workers of Holden or any other car manufacturer or component manufacturer in Australia. These people and their families depend on this industry. Just like BMW factory workers in Germany depend on their company to survive.”

University of Adelaide Associate Professor John Spoehr, who has conducted studies into Australia’s vehicle manufacturing operations, said it was wrong for the BMW boss to assume the end of Holden was near.

“I don’t think there is anything inevitable about the closure of Holden at this point in time regardless of who wins government next weekend,” Professor Spoehr told News Corp.

Professor Spoehr added: “What we are going through in Australia at the moment is not dissimilar to what car makers have gone through in (Europe) to compete with low-cost producers in East Asia.

“(Mr Horton) is part of a car-making operation that has received significant assistance from the German Government. In fact most German car makers have been in receipt of high levels of government assistance for some time.”

In addition to government support from its homeland Munich, BMW receives tax breaks from governments in South Africa and the US where it also makes cars.

Mr Horton is a Briton who started his career at Ford in the UK in 1977 before switching to the luxury German brand in 1995 and later running its operations in South Africa and the Middle East before being appointed to Australia two and a half years ago.

“The Coalition is not making the sorts of noises Labor has been making (in terms of industry support),” said Mr Horton. “I could be completely wrong, but GM has closed other plants in other parts of the world.” 

When approached by News Corp on Friday Mr Horton did not seek to distance himself from the comments made a week ago. Holden has also refused to comment on the BMW blast but News Corp understands the bosses of both companies have spoken since the incident.

Horton’s initial spray went on to say: “There are some massive economic factors that you just can’t get away from: we are a very, very long way from anywhere else and, right at the moment, even though the dollar has weakened, it’s still a very expensive place on a worldwide basis to do anything. It’s a very expensive place to take things out of the ground and it’s a very expensive place for a worldwide car company to make cars.”

While Mr Horton may think Holden has a bleak future given its reliance on taxpayer funding, in May last year he attacked the Australian Government for the high rate of Luxury Car Tax on BMW vehicles.

“Quite frankly I think the government in Australia, the way that they tax the Australian motorists, in my perception, (provides) very little return of those massive revenues that they get, in terms of things like improving road infrastructure. It’s a scandal,” said Mr Horton.

Federal Industry Minister, Senator Kim Carr said: “BMW is clearly dancing to Mr Abbott’s tune and their comments are dripping with vested interests.”

A University of Adelaide report on the economic impact of Holden’s recent round of 400 factory-job cuts, said if Holden were to shut its factory in Elizabeth it would lead to the loss of 16,000 jobs across the community, wipe $1.5 billion of economic activity from the state, and lead to a loss of $85 million in tax revenue each year in a “worse case” scenario.

Professor Spoehr, who wrote the report released in May this year, also warned that one-third of blue-collar workers would likely become long-term unemployed.

“We know from the research that a high proportion of manufacturing employees go on to be long term unemployed when a closure occurs during an economically difficult time like the one we’re going through,” he said. “It requires significant retraining to work in … other sectors.” When asked to put an estimate on how many factory workers were likely to remain unemployed in the long term, he said “about one third”.

“When Mitsubishi closed (in 2008), far fewer workers went on to be unemployed. But (economic conditions) are qualitatively different to when Mitsubishi closed. We’re in much more difficult times.” Professor Spoehr said 30,000 manufacturing jobs had been lost in Adelaide since the Global Financial Crisis.

This reporter is on Twitter: @JoshuaDowling