Dumarey still looking at Australia

The Belgian entrepreneur Guido Dumarey still wants to manufacture vehicles in Australia despite the termination of negotiations with General Motors to take over Holden’s Elizabeth assembly plant and the Zeta architecture. But the how and why of the head of Punch Corporation’s Australian ambition are far from clear.

Punch’s Australian media spokesman John Frey of GRACosway public affairs and media consultants told motoring.com.au he expected Dumarey to return to Australia within weeks to pursue “alternative options”.

“Guido remains confident there is a car manufacturing concept that will work in Australia,” Frey said.

“Does that mean he has a second set of negotiations lined up? No. But he believes with the Australian dollar trading where it is and that that is its natural position, so there has to be an option somewhere and he wants to pursue it.”

The end of GM and Punch’s negotiations was communicated late on Friday afternoon after a meeting between representatives of General Motors International and Punch in Tokyo. Dumarey and his strategy chief Marc Maes represented Punch.

The short resulting statement was released last Friday.

Any chance of anything more than minimal detail emerging from the meeting – officially at least – are curtailed by a non-disclosure agreement.

But there are several points worth making.

Firstly, the termination came even before Punch had put a detailed business case to GM, something it intended to do after another visit to Australian in early March.

And a key point cited for the failure of the negotiations was “the wind down of the supply base”. Dumarey is a fan of vertical integration and was planning to bring as much of that supply base in-house at Elizabeth as possible, reflecting the way he has his transmission plant in Strasbourg set up. And, of course, any disquiet the Punch people may have about the termination will no likely be muted by the fact that GM is a customer of the Strasbourg plant.

Friday’s announcement caught even some of Punch’s closest allies in its bid for Elizabeth and Zeta unawares, including federal industry minister Christopher Pyne who had written to GM urging it take the proposal seriously after meeting with Dumarey earlier this month.

Several expressed no knowledge of the meeting beforehand and were shocked by the outcome.

But it is understood the meeting had been scheduled for some time.

While some current and former auto industry executives and members had come to believe Punch’s proposal had a shot at success, Dumarey himself had always stressed how hard it would be to get across the line. Despite only ever making minimal public comment, GM and GM Holden had a similar view.

Nick Xenophon, the independent South Australian senator who was Dumarey’s first contact and key ally in Australia, expressed his disappointment at the outcome to motoring.com.au.

“I have spoken to them [Punch] at length and they had no issues with General Motors. They have not given up on investing in Australia.

“They see opportunities in Australia.

“Auto manufacturing is an industry we need in Australia,” he continued.

“It employs a lot of people, it drives innovation and it drives skills. It is very important for the country,” Xenophon stated.

While we wait for another chapter to unfold in Dumarey’s Australian ambition, start-up Ethan automotive becomes the primary driver of a future for local production beyond the closer of Ford in 2016 and Holden and Toyota in 2017.