Holden streamlines its factory

GM Holden has streamlined its vehicle manufacturing operations in South Australia by introducing a new shift pattern it says can save $10 million per year. The move to improve efficiency at the Elizabeth plant also includes operator productivity improvements of between 10 and 15 per cent, which essentially means more cars that cost less to build.

Holden’s maximum production capacity is now 400 vehicles per day, achieved in one shift instead of two – basically by doing 16 hours of work in eight hours. Previously the two-shift output was around 430 vehicles per day.

Holden said its new per-vehicle cycle time of 60 seconds puts it on the same level as a plant in China that only makes the Cruze small car.

Holden has already revised its production process in preparation for its facelifted VF Commodore, which will go on sale in May next year. The new V-car will also form the basis of two export models – the long-wheelbase Caprice-based PPV police car and the upcoming short-wheelbase Commodore SS-based Chevy SS.

It will soon also be preparing the factory for production of the second-generation Cruze due in 2016.

However, GM Holden Chairman and Managing Director Mike Devereux said that, regardless of improved plant efficiencies, Holden could not survive without federal government co-investment.

“With these tough economic conditions it's our obligation to our people, and those that invest with us, to build a sustainable business and to continuously improve productivity,” he said.

“If this country thinks that investing and [government] co-investing with the auto industry is not something we should be doing, then this plant will cease to exist the second this country stops doing this. Not maybe, not if, it will not exist.

"These people will not have jobs if the whole country doesn’t think they have to compete," Mr Devereux warned.

“Every country does this. So it’s illogical to assume that if we don’t, we can survive against every other auto-making country that does. It is just absolute pure logic.”

The Holden chief spoke passionately about the need for government assistance for the auto industry, which he accepts is not always be popular with the general public.

“It is an emotional issue. Why should the tax-payer support the auto industry? We get a lot of things written about it. The fact of the matter is it happens everywhere in the world. You can like it or dislike it, it is just a fact -- if it doesn’t happen you just don’t make cars," he stated.

“We do take these investments quite seriously and we feel a great deal of responsibility but because you all help us to survive through your taxes it’s not something we take lightly. When we got our co-investment for Cruze, it generated over the life of its program over a billion dollars of economic activity.”

Holden says the improved efficiencies at its South Australian plant cements it as a globally competitive manufacturing base and will also help secure the future of local manufacturing.

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