Holden loses another Commodore export deal

The strong Australian dollar has claimed another trade deal. Exports of the Holden Commodore to the Middle East have stopped just months after shipments to Brazil ceased.

Both export deals were small – Brazil was forecast to take 600 or so Commodores each year and the Middle East only took 150 cars last year – but they are symbolic of the dilemma facing Holden and its Australian manufacturing operations.

The car maker was hoping to export its way to a brighter future and better viability but the strong Australian dollar – which has risen 30 per cent since the recent export deals were announced – have made the trade deals uncompetitive and unprofitable.

In the meantime, Holden will continue to export the Caprice limousine to the Middle East – the same car it is trying to sell to the US as a police car – because it is protected somewhat by a higher retail price and profit margin.

Holden sold about 4000 Caprices in the Middle East last year – twice as many as were sold locally in the same period, but still only a fraction of the Caprice’s Middle East sales peak of 12,000 sales in the mid-2000s.

If Holden is struggling for the Commodore to make a business case then it is likely that Toyota, Australia’s biggest vehicle exporter, is also under financial strain.

More than two-thirds of the Camry sedans made at Toyota Australia’s factory in Altona – between 55,000 and 92,000 cars each year – are shipped to the Middle East.

The president and managing director of General Motors’ Middle East Operations, John Stadwick, said the remaining stock of Commodores (sold as a Lumina there) would not be replaced in the new year – and he expected buyers would instead opt for the new Malibu mid-size sedan or the Camaro SS coupe.

“We’re not selling the Lumina here in 2012,” Stadwick said. “We have the all-new Malibu and we also have the Camaro. The plan of record for a while now has been to discontinue the Lumina and go with the Camaro and the Malibu.”

However, Stadwick said the Caprice export deal was safe for the time being.

“The Caprice is a very strong nameplate … and a very important vehicle for us. I met with Minister Carr from Australia two weeks ago here talking about the importance of the Caprice for us going forward.

“We’re monitoring the number of Caprices [we import]. We want to keep the nameplate in the market. We don’t think that the Australian dollar is going to continue at its record strength and when it comes down we can look to export more vehicles out of Holden and into the Middle East.”

The head of General Motors International Operations Tim Lee added: “Exports from Australia have really been a key piece of our portfolio here in the Middle East for a long time [since the VT Commodore in the late 1990s].

“The fundamental problem we have is your currency has strengthened to the extent that it makes the export of the vehicle far less economic. I didn’t say we’re losing money but you tell me what the Aussie dollar is going to do and we’ll tell you how many Caprices we’ll sell.”

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