It's not exactly the bad news we were expecting... Holden has decreased local and export production at its Elizabeth plant in South Australia, but is attempting to placate its workers (and the union) with a more realistic production schedule - without sacrificing jobs.
That's not to say that every worker can live with, nor survive on, the changes Holden is proposing.
Senior executive pay reductions and cancelled bonuses, pay freezes, and a previous round of non-production days on both the engine and production lines have not been enough to support Holden through the global financial crisis, particularly in light of its parent company's woes.
In exactly one month, the Elizabeth plant, which produces 45 variants of the Commodore for domestic and export markets, will cut down to one single, two-crew shift per production day. This will produce about 310 cars each shift - about half its potential capacity. When the VE and its derivatives were running at full steam in 2007, the plant was pumping out the maximum of 620 cars per day.
The plant will run a one day on - one day off or fortnight on - fortnight off system depending on the needs of the individual employee, and still offer 50 percent pay during each down day.
Holden hopes the slow-down will keep its workers and company going until its locally-built four-cylinder Cruze small car begins production - and the world's economy begins to pick up - in 2010.
"These are unprecedented challenges and they require unprecedented decisions to protect Holden for the future: none of this is easy," said GM Holden Chairman and Managing Director, Mark Reuss.
"This is the best way to protect jobs in the current environment and keep Holden in the best possible shape leading into the opening of our second car line and an improvement in global market conditions.
"We are acutely aware of the impact this change will have on our people and we will do everything we can to support them through this. We'll do everything we can to find the best solution for each Holden worker and we will work through our people's circumstances on a case-by-case basis," he said.
The changes should also enable Holden's many suppliers to plan for the future and re-jigg their orders - or plan their retirement...
OFFICIAL PRESS RELEASE
- SHIFT CHANGES PROTECT HOLDEN JOBS
GM Holden will move to a single shift, two crew operation with no retrenchments at its production plant in Elizabeth, South Australia.
The new shift pattern comes into effect on 4 May in response to global economic conditions and falling volumes across the sector.
GM Holden Chairman and Managing Director, Mark Reuss, said the change would enable the company to preserve jobs ahead of the introduction of Holden's new small, fuel efficient four
cylinder small car in 2010.
The new production level will be approximately 310 cars per day, aligning production with current forecast demand in both domestic and hard-hit export markets.
GM Holden will work with union representatives to negotiate employee rosters around the single shift with options to include one week on, one week off or two weeks on, two weeks off.
Employees will still receive 50 per cent pay for days when they are not working.
"This is thee best way to protect jobs in the current environment and keep Holden in the best possible shape leading into the opening of our second car line and an improvement in global
market conditions," Mr Reuss said .
GM Holden announced in December last year that it would begin producing a small, fuel efficient four cylinder vehicle at the Elizabeth plant in 2 010.
Elizabeth is GM Holden's only vehicle assembly plant, building 45 variants of the Commodore large car range for domestic and export markets.
Mr Reuss said today's decision had been the only responsible course for Holden given exceptionally challenging market conditions, in Australia and overseas.
"We are acutely aware of the impact this change will have on our people and we will do everything we can to support therm through this. This will include paying 50 per cent pay on
down days and ensuring flexibility in our rostering to assist employees to plan their lives."
Mr Reuss said that while the changes were intended to protect jobs there was no doubt the reduced hours would cause hardship for many employees.
"We'll do everything we can to find the best solution for each Holden worker and we will work through our people's circumstances on a case-by-case basis," he said.
Today's decision follows a number of other cost cutting measures at GM Holden i including a pay cut for senior executives, pay freeze for white collar workers and the cancellation of bonuses
and the scheduling of non-production days at vehicle and engine manufacturing facilities.
"These are unprecedented challenges and they require unprecedented decisions to protect Holden for the future. None of this is easy," Mr Reuss said.
Mr Reuss said the decision was likely to have a beneficial effect across the supply chain, particularly for automotive suppliers, seeking greater certainty in production scheduling.
"Suppliers have been calling for greater certainty and clarity around production scheduling so they can align their efforts. This change will let them do that," Mr Reuss said.
"We have been modifying our monthly production plans in a challenging environment since last year but this made it difficult for our suppliers to provide parts in a consistent manner and we
weren't able to provide a steady flow of vehicles to our customers.
"These changes preserve the integrity of the entire process of making cars from suppliers to dealers."
Discussions are underway with the Federation of Automotive Products' Manufacturers to coordinate production schedules between local manufacturers to further ease pressure on the
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