Cruze plus two for Elizabeth?

Holden will build not one, but two small cars alongside the Commodore from late next year – and it may eventually add a third model to the mix.

"We are going to build both a small hatch and a small sedan in Adelaide," the chairman and managing director of Holden, Mark Reuss, told Carsales Network this week.

"We are on the record with that, and let me tell you we are working full steam ahead on it," the Holden chief stated.

In the meantime, Holden will sell the Cruze, a Korean-sourced Corolla rival, until the locally-made small cars come on stream.

Holden is yet to announce what the new small cars will be called, and has left the door open for the Cruze or Astra nameplates to continue – or for a new name to be introduced.

"To be honest, we are leaving [the name] until as late as we can," says Reuss. "We are focusing on getting the car right, the business case right and doing the best small car possible."

Even though he has only been in the top job at Holden for a year, Reuss, an American on secondment to Australia, has acted swiftly at shoring up the future of Holden. With a business and engineering background, the Holden honcho has used his contacts in Detroit to help fast-track and secure Holden's small-car manufacturing deal.

Crucial to the deal is support from the Australian Federal Government. Reuss confirmed this week that the government's investment scheme would contribute a quarter of the development cost of the locally made small cars.

"Government support definitely made the difference between [small-car manufacturing] happening or not," Mr Reuss said. "This will accelerate Holden into a whole new era of modern technology and more efficient cars."

The core structure and underpinnings for the new small cars are GM's new Delta platform -- the same as that used for the Chevrolet Volt electric car, but Mr Reuss said it was "highly unlikely" that the Volt would be built here in the short term.

"Does it give us the option one day to go that way? Yes, but that is not our plan. The point is this next move clicks Holden into the latest platforms and technologies that GM is working on. Anything they're building overseas, we will have the flexibility to build here."

Holden is also considering a medium car to join the Commodore and the small cars on its Adelaide production line.

"It's very early days but we are looking at everything to make sure that Holden and Australian jobs are not exposed," Reuss said.

"If you look at the market, you want to make sure you have all your bases covered as people look to downsize."

Reuss said GM's new Epsilon II medium car platform (as pioneer the Euro only, Opel Insignia) could be built at Elizabeth.
 
Toyota hedges its bets locally, building a four-cylinder Camry medium-sized car and a V6 Aurion large car on the same production line. And in 2011 Ford will join Holden as a small-car maker when it begins assembling the Ford Focus alongside the Falcon and Territory. Story by-Josh Dowling

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