By JR on Friday, March 23, 2012
Australia making cars is an absurdity
JULIA Gillard has defended spending $215 million in taxpayer funds to prop up Holden, saying there was a real risk the iconic carmaker was about to close its Australian plants.
The Prime Minister did not rule out further bailouts for the ailing car-makers, predominantly based in southern states, saying there was an "ongoing program" for assistance.
"This funding is not a handout it is a strategic investment that will boost our economy, foster innovation, build new business opportunities and promote adoption of new fuel-saving and safety technologies," Ms Gillard said.
The federal funding is matched with smaller contributions from the South Australian and Victorian governments to ensure Holden stays in Australia for at least a decade.Holden had planned to close its Australian operations by 2016, which would see about 12,000 jobs lost.
The company's chairman, Mike Devereux, made no commitments about retaining jobs.
"If you can tell me what the Australian dollar is going to be seven, eight, nine years from now, what all of my competitors are going to do ... I might be able to tell you how many vehicles I would be able to produce and therefore how many employees I might have," he said.
The Opposition is divided on how to assist the car industry.
Treasury spokesman Joe Hockey suggested government funding should be cut but industry spokeswoman Sophie Mirabella said taxpayer funding was fine as long as it was clear where it was coming from.