Prime Minister 'encourages' Dumarey

Australian Prime Minister Malcom Turnbull has met and encouraged Guido Dumarey, while a senior minister has made it plain the Belgian entrepreneur now has federal government support for his plan to buy the GM Holden assembly plant in Adelaide and keep building the locally-developed Commodore in production beyond 2017.

The PM dropped in briefly on a meeting between the Belgian entrepreneur and a manufacturing and innovation adviser from his office. It is the first time Dumarey has met Turnbull.

It is not expected the PM will take any active part in negotiations over the plant and the future of Commodore. Instead industry, innovation and science minister Christopher Pyne is the government’s pointman on negotiations with Dumarey and his company, Punch Corporation.

A government spokesperson confirmed a meeting between Pyne, who is from South Australia, and Punch on Tuesday in Canberra, described the talks as “productive” and said that an agreement to continue to work together and “further evaluate the proposal” had been made. It was the second meeting between Pyne and Dumarey in just over a month.

On Tuesday on Channel 7 Adelaide current affairs program Today Tonight, Pyne said the PM had been “obviously very encouraging” in his brief meeting with Dumarey.

And he made it clear the federal government now supported the Dumarey bid.

“Now having met with him (Dumarey) a couple of times, I’m of the view that he can bring it off with Government support, and of course with the acquiescence of General Motors who are the ones who are selling the plant,” Pyne said.

Dumarey is now scheduled to move on and meet with representatives of the Victorian and South Australian governments this week.

Dumarey is not expected to have any meetings with Holden while in Australia. It is understood his negotiations have escalated to General Motors after he made first contact with the corporation’s global management in Detroit in January.

All parties involved in the negotiations have set a mid-year deadline on getting the deal done that would not only mean Punch taking over the plant but also the Zeta architecture upon which Commodore is built.

One common point of agreement across Punch, government and GM seems to be just how difficult this deal will be to make happen, given Dumarey is asking GM to hand over a ‘free license’ to its Zeta intellectual property.

“We don’t want to raise expectations for the people in Northern Adelaide in particular, because I’d hate to see them grieving a second time for the closure of the car industry,” Pyne cautioned on Today Tonight. “But Mr Dumarey does have a serious proposal, representing Punch Corporation.

“A lot rests with the decisions that General Motors make in Detroit, and that’s why I’ll be writing to the chairman of General Motors in Detroit, to the senior executive members there, encouraging them to have a very open mind to Punch Corporation’s proposal.”

Pyne said GM was waiting to see a serious business case.

“Multinational corporations are quite bureaucratic and I imagine they have quite serious processes to go through, but there’s a couple of big positives for General Motors. One is if they can seriously pull off the keeping open of the plant at Holden and work with Punch it’ll do a lot for their reputation in Australia.

“And of course, if Punch Corporation takes over the remediation of the site at Holden it’ll save them a great deal of money.”

Dumarey has outlined ambitious plans to develop a family of premium models from Zeta, as well as a light commercial line-up. The vehicles would be manufactured for local sale and export. Dumarey has pledged to commit around $150 million to the proposal, but also made it clear he would require access to Automotive Transformation Scheme (ATS) funding.

But Pyne said Dumarey was not after any other funding and described him as a “serious business person”, citing his successful takeover and rejuvenation of a GM transmission plant in France which had been slated for closure.

“He’s not asking the Government for money, which is different to many of the other proposals that have come to us since the announcement of the closure of Holden,” Pyne said. “He wants to work within the current parameters, and I think that is an important difference than some of the other proposals that have been put to us.”

Pyne also shed further light on how Dumarey sees his plan working.

“He wants to use the platform that is already out there to build vehicles, but he also wants to do some of the things around componentry, bringing together the different component manufacturers in South Australia, and also working with the Victorians.

“So he has a very broad proposal, and the Government would like to see it come to pass, but we don’t want to over-egg the omelette, so to speak.”

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