Filed under: Earnings/Financials, Holden
GM Holden reports loss
GM Holden has been in the international spotlight of late thanks to its new VE Commodore sedan, but the Aussie subsidiary is now getting attention because of its poor financial performance. Despite the Commodore maintaining its position as the number one selling vehicle down under in 2006, total revenues were down 7.8% over the period, which meant that Holden ended up with a substantial $123.7 million loss.To its credit, the results were skewed by the costs associated with launching the VE range, along with a host of other reasons. Management blames exchange rates that favored imports, higher fuel costs and heavy discounting of older VZ series models as justification for the poor results.
Things were very different only a few years back. Under the guidance of Peter Hanenberger, Holden turned consecutive profits in excess of $200 million for the years 2002, 2003 and 2004. Things went sour when Hanenberger was replaced by American exec Denny Mooney, who just last month left the job to Chris Gubbey, who's stepping in following a stint as executive VP of Shanghai General Motors.
Holden's survival is vital to GM's revival of its rear-wheel drive heritage. Apart from the Camaro coupe, Holden engineers are also rumored to be developing several other rear-drive models for GM including a new Pontiac GTO, Chevrolet Impala and a V12 Cadillac flagship.
[Source: GoAuto News]
Reader Comments (Page 1 of 1)
Ian 3:21PM (6/18/2007)
Your article appears to suggest that Mooney is totally responsible for the 2006 losses? Isn't the period 2005/6 when Holden persuaded GM that they (Holden) should spend the money to re-develop the failing gobal Zeta platform? And the roll-out of cars in the last 6 months is a direct result of that vision and expense. Thus losses in 2006 are not unexpected and could well be replaced by years of decent profits as Holden benefit from being the first GM company to sell the new rear drive cars?
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FLR 3:31PM (6/18/2007)
I think for 2008 Holden will make their money back as the Pontiac G8 will fly off the lots in the US.
I hopefully will have a red G8 with the L76 and 6 speed in my garage next year.
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... 5:57PM (6/18/2007)
"the Pontiac G8 will fly off the lots in the US."
what do you base this on, the fact that you want one?
FLR 7:13PM (6/18/2007)
Ooooo...good come back! Yes, I do base my reasoning on the fact that I want one. The G8 is going to be a full sized rear wheel drive V8 4 door vehicle that is available with a 6 speed manual for $35k. The closest vehicle to that is the CTS-V which stickers for $50k. Above that is the 540i. I was considering a CTS-V.
They are also offering GM's excellent 3.6L V6 which makes around 260 HP.
Look around at all the Chargers, 300s and Magnums. The market is there.
I know a lot of Fbody guys are ready to move up into a nicer, much nicer vehicle.
Now, tell me why they won't fly off the lots.
That's Too Funny 3:39PM (6/18/2007)
Damn!
Everything G.M. gets it's hands on turns to Shit!!
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xxxxxxx 4:19PM (6/18/2007)
Thats too funny:
Your comment shows how ignorant you are.
General Motors has owned 100% of Holden since 1931.
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F451 4:24PM (6/18/2007)
Another poignant reason that GM's top executives, and Board of Directors needs to resign. A perfect example of how Americans' go into another country and try to impose what they think is best for that country while disregarding the realities. I like how the GM spinmiesters' go to work with their propaganda.
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TriShield 4:53PM (6/18/2007)
Holden's biggest problem is rising petrol costs. The Australian market is shifting to smaller, more frugal cars than the Commodore and Holden doesn't offer a good one. They just have a rebadged Daewoo that has not been met with rave reviews.
It's too bad Holden hasn't produced the Torana concept they showed years ago. It was compact, RWD, and the market is ripe for a small car like that. Holden desperately needs it now as consumers look to downsize.
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The Other Bob 6:38PM (6/18/2007)
The also sell the Opel Astra as a Holden.
It's a great car, it's small and it isn't a Daewoo.
Gregh1952 4:59PM (6/18/2007)
I passed this car in Indianapolis this afternoon. It was being transported with a Austrailian GTO and 3 Audis. It was white, had a V8 emblem and badged as a Chevrolet Lumina SS. The only styling change was a Chevrolet bowtie on the grille. Wish I had a camera with me!
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Pep Boys Sux 5:04PM (6/18/2007)
Well, being that GM has owned Opel and Holden for most of the twentieth century, I think you are bound to realize you'll have some downturns...unless you're stupid or named F451.
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F451 5:28PM (6/18/2007)
I see we have yet another GM shill among us. Yeah, go ahead spread the blame around other than where it belongs. Are you having dinner with Lutz tonight?
Viv 7:45PM (6/18/2007)
We also seem to have an idiot among us.
F451 8:58PM (6/18/2007)
Viv, you anteing-up on this one?
HotRodzNKustoms 7:12PM (6/18/2007)
They did just finish developing like a $1,000,000,000 platform so I think that could attribute to some of that loss, not to mention tooling costs for that new platform and cars that sit on that new platform. Coming out with new cars isn't a cheap thing.
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Barney 8:48PM (6/18/2007)
"Coming out with new cars isn't a cheap thing."
It also takes time and who knows if the fickle buyer still wants the concept that started years before. What sold three years ago may not sell today.
chris 11:13PM (6/18/2007)
It's probably also due to the fact they've stopped using Opels for a couple of their cars (keeping only the Astra) and have swapped them out for rebadged Daewoos that get terrible reviews from everywhere. And the fact that Toyota have gone from just having the Corolla and Camry in the top 10 in Australia to also having the Yaris, Hilux and Aurion in the top 10 as well probably doesn't exactly help Holden out much when they only have the Commodore and Astra selling big.
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Chris 9:38AM (6/19/2007)
Hold on.
Holden have hit a loss due to the one offs (eg. VE development) and a down turn in sales of the Commdore. Add that to the crap sales of the Vectra & Astra and the high costs it's no wonder.
They've just completed their transformation form euro to korean model range as well.
Give it 1 year and it'll be back level
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