Holden targets local market with Cruze

The obvious question regarding the unveiling of the Holden Cruze this week was whether or not the Australian-built small car's future included export but Holden is focussed on its significance locally.

It's no secret the loss of the Pontiac G8 export contract left a hole in Holden's production capability which is well beyond the current 60,000-unit turnover currently assigned to Commodore.

GM-H's managing director Mike Devereux suggests production figures around 100,000 are necessary for a manufacturing plant to "start to get economies of scale".

"Car plants that make [only] 65,000 cars a year are a bad idea... This [vehicle manufacture] is a hugely capital-intensive business.

"It's safe to say our long-term plan needed to include the Cruze."

Devereux says the Cruze has proved itself sales-wise in sedan-only form and only stands to do better once the hatch is made available to the range.

"The vehicle segment we're now launching into is the biggest in the country. We already have a top-ten vehicle [in sales] and we think we have a top-five vehicle when we get the hatch."

As for export opportunities, Devereux says: "There's certainly export potential but we don't have a plan right now for that to be included in our current plan.

"It's logical for us -- in this, or perhaps a future [Cruze model] generation -- to see this type of vehicle in right-hand drive markets like South Africa and the UK.

"But everyone here is concentrating on stabilising and localising this car," said Devereux. "Holden's business plan isn't based on exporting cars."

The situation for Holden now is different to "years ago, when 50 per cent -- or around that -- of total sales were exports."

He argues fluctuations in currency and demands in various markets means the local market and manufacturers "should be able to live on their own terms in this country."

"Exports -- whether they be police cars, Commodores, Cruzes -- have to be the icing on the cake, not the ingredients of the cake."

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