Dumarey chases Turnbull

Belgian Holden bidder Guido Dumarey is headed Down Under next week. The Belgian entrepreneur is seeking a meeting with prime minister Malcolm Turnbull, as he continues his bid to save the current Holden Commodore and the assembly plant in the South Australian capital Adelaide where it is built.

Dumarey’s plan to build premium and light commercial vehicles at Holden’s Elizabeth plant based on the Commodore’s ‘Zeta’ architecture for both domestic and export sale was revealed by motoring.com.au last November. Since then Dumarey, the head of the Punch Corporation, has made a pre-Christmas trip to Australia to press his case with local politicians and introduce himself to Holden.

He has also met with General Motors executives on the sidelines of the Detroit auto show about his plan, armed with a supporting letter from federal industry minister Christopher Pyne, who is from South Australia.

Pyne’s public pronouncements about Dumarey have triggered widespread interest in his plan, which is dubbed Project Erich. The South Australian premier Jay Weatherill and his automotive transformation minister Kyam Maher have also confirmed meetings with Dumarey.

Dumarey has previously stated an agreement would have to be made in the first half of 2016 for his plan to have a chance of success. As it stands, the Holden plant is scheduled to close and Commodore production cease by the end of 2017. The Toyota plant at Altona will close around the same time, while Ford’s Broadmeadows factory closes in October this year, signalling the demise of the locally built Falcon and the Territory SUV’s replacement by an import.

Dumarey’s closest political adviser in Australia remains South Australian independent senator Nick Xenophon, who is believed to be pushing for this first meeting with the PM and another round of discussions with Pyne next week.

While unwilling to discuss the upcoming visit specifically, Xenophon called on the federal and South Australia governments to engage with Dumarey in serious discussions about his proposal.

“There needs to be political will on the part of the state and federal governments to make this happen, because if there are credible proposals to revive the automotive sector in this country then they need to be taken very seriously,” Xenophon told motoring.com.au in an exclusive interview.

“The Punch Corporation bid is a fair dinkum bid. They just want a fair go.

“We cannot give up on auto. There is too much at stake here. Once we have lost the auto sector we will lose it forever.

Xenophon also said GM Holden must fully engage in the process, as Dumarey not only wants to purchase the Elizabeth plant but gain a ‘free license’ to develop the Zeta architecture, which is scheduled to go out of service when the current Commodore ceases production.

Publicly, the company has said little, acknowledging it would consider offers for the plant and that it is awaiting a detailed proposal from Punch.

“I can’t tell you what the level of engagement is with GM, I can only refer to their public pronouncements,” said Xenophon.

“[But] GM needs to realise that if they are not fully engaged in this process, where there is a credible bid in place to take over the Zeta platform, what the consequences of that will be for Australia.”

Xenophon argued a successful Punch bid could provide the stability and retain the supplier base that would enable other automotive aspirants such as Ethan Automotive  and RED bring their projects to reality. He pointed out the collapse of the sector and widespread unemployment expected after the ‘big three’ close would have serious consequences for the Australian economy.

“The Bracks Review forecasts the loss of 200,000 jobs. Even if 100,000 of those jobs end up on welfare we are looking at a welfare bill of conservatively $2 billion per year plus the knock-on effects of lower tax receipts, lower spending at your lower stores and supermarkets, let alone buying a new car or house.

“Economic activity is depressed when people are forced on to welfare.”

Xenophon acknowledged one of the challenges of the Punch proposal was that Dumarey was virtually unknown in Australia before the bid for Elizabeth was revealed, despite a 33 year career in automotive and other industries, including his recent take over and rejuvenation of a General Motors transmission factory in France.

“He has a never say die attitude. He has obviously done this before. He has a passion for manufacturing. He says a well paying job is a social right. When its people are not working in a meaningful, well paid job then society breaks down. He gets that.

“Yes, he is a tough, hard-headed businessman who makes things that people want but he also understands the social context in which he operates. And that is that people need work.”

Xenophon said there was no downside to at least considering the Punch proposal seriously.

“What have we got to lose?” he asked.

“There is only upside here.”