Wednesday, March 21, 2012

Australia plans $28m subsidy for General Motors

Australia plans $28m subsidy for General Motors
Associated Press, Canberra | Thu, 03/22/2012 9:48 AM
A | A | A |

The government announced Thursday a 275 million Australian dollar ($288 million) subsidy for General Motors Co. to guarantee it continues to manufacture cars in Australia for another decade through its subsidiary Holden Lt.

As part of the deal, U.S.-based GM said in a statement it has agreed to invest more than $1 billion in car manufacturing at its Melbourne and Adelaide plants until at least 2022.

Holden will use the government assistance to design and build two new cars for the global market after 2015, the statement said.

Prime Minister Julia Gillard said GM had considered closing its entire design and manufacturing operations in Australia.

Australian manufacturers including Holden have been losing exports due to the strong Australian dollar, which has been bolstered by record Chinese industrial demand for minerals and energy.

Holden is one of seven global GM operations that designs, builds and sells vehicles for domestic and international markets.

The federal government will provide AU$215 million while the Victoria and South Australia state government will provide the remainder.

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