THE GOOD 'OLE DAYS - SIGN OF THE TIMES - by John Crawford

Aaha. 1977 in the USA gas was averaging 60c a gallon, so it cost sixteen bucks to fill the tank on the Ford Ranchero, and this exercise in largesse was fitted with a 6.6L Cleveland V8.

So that means the fuel economy wasn’t anything to write home about – but then if you went too far, too fast, there was no guarantee you would get home, without a splash’n’dash.

 Spotted this little left-hook baby (?) on the Queensland Gold Coast, so somebody loved it enough to show it off – but I’m guessing with gas costing upwards of AUD$1.80 a litre these days, it’s only used for short trips.

John Crawford

GM'S FUTURE PLAN FOR AUSTRALIA by John Crawford

Despite retiring the Holden brand name, forcing the 180 dealers to close up shop, General Motors does have a plan to sell cars in Australia. The hints are contained in the somewhat ambiguous wording of its recent press statement announcing Holden’s demise.

GM president, and former Holden chairman and managing director, Mark Reuss said: “We do believe we have an opportunity to profitably grow the specialty vehicle business, and plan to work with our partner to do that.”

GM 'specialty vehicles'
Top to Bottom
Camaro; Silverado; Acadia; Corvette C8

Okay, here’s the translation: General Motors has an existing contract with Walkinshaw Automotive (owned by the widow and son of former racing driver, the late Tom Walkinshaw), which already carries out RHD conversions on the Chevrolet Camaro and Silverado pickup – and this business will continue.

Also, the Chevrolet Corvette C8 (which is already engineered for RHD) will be produced in the USA at the Corvette facility in Bowling Green, Kentucky.

The GMC Acadia is also produced in RHD, in Tennesee, which means that GM vehicles could continue to be sold in Australia in low, but profitable volumes.

Buyers will access whatever models are involved in this plan through those Holden dealers which are already signed up as distributors with Walkinshaw Automotive.

Holden’s acting Chairman and Managing Director, Kristian Aquilina, said:

“If there is a presence, and there is still a lot of water to go under the bridge, and I don’t want this to be a distraction from the bigger message from today and Holden’s announcement, but if there is an ongoing presence it will be a very minimal one, he said. “It is already in its infancy and we are not sure how it will progress.”

According to my source in the USA, the departure from RHD markets was conceived well before GM’s plan to sell its European operations to Groupe PSA, but as Holden’s market share headed below 4%, and sales of its Commodore and Astra models had stalled, it was time to pull the pin.

Selling its Thailand factory, which was responsible for RHD versions of Colorado, to China’s Great Wall Motors, was a major factor in GM shutting down Holden.

Holden was just not selling enough vehicles to be able to survive, and was unprofitable to sustain.

John Crawford

THE HOLDEN BLAME GAME by John Crawford

In my own analyses in ‘Driving & Life’ of the reasons behind GM’s shock closure and abandonment of the Holden brand I have focussed on the corporate decisions which hastened its demise.

However, writing today in Australia’s national broadsheet, The Australian, respected business commentator and analyst Robert Gottliebsen stresses the part which greedy unions played in the Brand’s demise. In fact the behaviour of unions in the Australian automotive sector, mirrors that in the USA over decades.

Gottliebsen points out that it was the unions which ‘controlled’ the factory floor, and successive Holden CEO’s appointed by GM in Detroit, were either powerless, or too timid to actually make a stand.

Whilst I lived and worked in the USA I watched from the sidelines as the same pattern emerged.

Every two years the unions would bargain a new deal for their members, and the companies simply gave in to their demands.

Which I think is akin to kicking the can a few more metres down the road.

In Australia, the behaviour of the unions was a material element of the slow death of car manufacturing.

The other was the plethora of various taxes and duties which successive governments saddled the car industry with; and then there was a stronger Australian dollar, at a time when GM had attempted to import Australian-built Commodores (under both the Pontiac and Chevrolet badges) into the USA.

As my good friend Bob Lutz has pointed out, the export/import deals were conceived when the Australian dollar was lower against the Greenback.

However, by the time it came to produce, export and invoice GM for the Australian-sourced cars, the Oz dollar had strengthened, meaning much lower profit margins for General Motors. The cars were priced too high and neither deal lasted long.

Everyone who drove the Aussie-built G8 Pontiac agreed it was a helluva car, especialy the 1,832 lucky buyers who managed to snag one.

Then we come to Government subsidies. For years, both Ford and GM, threatened governments of all political colour that if they did not get their subsidies they would pull out of Australia. Governments, of course, capitulated. None of them wanted the bad press, or bad PR of putting thousands of Aussie workers out of a job.

None more so than when Labor was in power, and left-leaning (meaning union intimidated) Minister for Industry, Senator Kim Carr (right) was in charge of doling out taxpayers' dollars to the car companies.

Yes, hindsight is 20-20 vision, but although I only began publishing ‘Driving & Life’ in 2010, I had been warning my friends in the US and Australian media since 2002, that the problems of maintaining the Australian car manufacturing industry had begun before the turn of the century.

I have already highlighted the fact that both Holden and Ford pressed on making cars that would be out-of-date by the middle of the noughties. They were benchmark cars, but the market had moved on.

No attempt was made to re-arrange their product catalogues.

The Japanese and Korean companies managed to see the writing on the wall, and fed into Australia products that actually resonated with shifting consumer preferences.

I was always against subsidies and handouts. Australia needed to maintain the intent of previous Labor Treasurer and later Prime Minister, Paul Keating, and ensure that Australia was free of duties and onerous taxes; the dollar floated on global exchanges; and the elimination of subsidies, which insulated companies against real market pressures.

I have always maintained that in a capital-driven business environment, the market should rule, and the uncompetitive companies should close-up if they can't compete.

The Australian automotive unions for their part should have seen the coming changes, and begun to agitate for expansion of training facilities, such as TAFE or trade schools, to ensure their members utilised a wider range of skills. However, we all know that once the union fatcats were banking their huge pay checks every week, they weren’t about to rock the boat.

Yes, it’s a tragedy that Holden will disappear from our social and automotive landscape, but I could see the potential for it to happen, more than 15 years ago, and as I have outlined – there is plenty of blame to go around. How's this for irony?

John Crawford

DOES RIDE-SHARING EASE TRAFFIC CHAOS? NO, EMPHATICALLY, NO! by John Crawford

So, when we welcomed Uber and Lyft into our lives, the idea was that ride-sharing would reduce traffic congestion.

Now, four studies – three in the USA and one in India – reveal the complete opposite. All four studies found that traffic congestion had increased since the disrupters entered the scene.

In the USA, researchers found that people don’t actually ‘ride-share’ – most riders travel alone.

Also, they prefer Uber/Lyft to public transport, so early passenger stats reveal that subway use has dropped – perhaps imperceptibly at this stage.

The Indian study in Mumbai (below) found ride-hailing services actually increased traffic congestion:

"This finding is evidenced by shorter traffic delays when Ola and Uber are off the roads during ride-sharing strikes."

Traffic delays were reduced by almost 7% in Mumbai and close to 5% in Delhi, which the researchers call "highly statistically significant."

In Austin, Texas, when new usage charges were introduced, cutting the number of Uber/Lyft vehicles in use, traffic speeds increased by 3.4%.

There's real common sense logic behind these findings. You imagine a retired guy who wants to earn a few bucks, or a non-working woman at home with some time on her hands. They decide to be Uber drivers, and you can increase the number of additional cars on the road by any number of multiples, and ergo, traffic chaos reigns.

These findings suggest again that you should be careful what you wish for. 

Outrageous claims about reduction in traffic congestion were touted by all the ride-sharing services, but in actuality the reverse has been the case. It also suggests you continue to take everything the Greens tell you is a 'silver bullet' to solve the world's problems with a grain of salt.

John Crawford

FORD AUSTRALIA - PREDATOR ON THE SIDELINES by John Crawford

As it watches its major rival squirm in the media spotlight, after GM’s decision to completely obliterate the Holden brand by the end of 2021, Ford Australia admits it is looking at some of the great Aussie talent which will be released by Holden, when GM closes its Melbourne design studio, and Lang Lang proving ground.

Ford Australia President and CEO Kay Hart said: “I’m sure there is some great talent in that Holden team. We would definitely be looking for that skill set that would fit with us here, and there well may be opportunities for that team to join Ford in the future.”

Her comments come as Ford says it will commit AUD$500 million to its Australian operation in 2020, and is likely to hire more staff, to add to its existing 2000 employees.

As doomsayers predicted the end of the locally-manufactured Ford Falcon a few years ago, there was doubt that Ford could survive in Australia with its imported vehicles.

Its sedan cars were not setting the market alight with excitement, but Ford Australia’s survival came from within its own Australian operations. It was the Ford Ranger truck!

Just like the USA and UK, the Australian market (almost overnight) has turned from loving cars, to embracing SUVs and trucks, and Ranger parachuted in to save Ford Australia.

Wholly-designed and developed in Australia, during Falcon’s deathroes, the introduction of the Ranger was actually part of a wider plan utilising the higly-skilled Australian design and production engineering division to simply deliver an updated truck which Ford could sell in developing markets.

Ranger was never part of some grand, sophisticated and well-researched plan to save Ford Australia. That happened entirely by accident.

Ford, like Holden, also had a revolving-door of middling, to talent-less chief executives pass through the ‘glasshouse’ at Broadmeadows. None of them were enlightened enough to see a grand future for Ford Australia.

Also, they were also powerless to stop the rusted-on cadre of ‘Falcon Forever’ stalwarts who refused to see the writing on the wall for their beloved mid-sized sedan.

As the market churned and changed, Toyota’s top-selling vehicle in Australia the Corolla hatchback, was supplanted by the Toyota Hilux truck in its various guises, plus Toyota's increasingly popular Kluger SUV.

Also, as SUV sales gathered pace, Ford had willingly retired probably its most potent weapon in that segment, the Ford Territory, which most 'real' experts agree was a world-class vehicle which failed to sell in big numbers through lack of marketing.

It was a benchmark vehicle, wholly-created in Australia by an Australian team based on the Falcon platform, and powered by the Falcon petrol engine, plus a diesel variant using the Peugeot-designed diesel V6.

At least Ford had a batch of new small/compact/large SUVs waiting in the wings.

Almost overnight, struggling Ford Australia, which couldn’t remember the last time it posted a ‘real’ profit was looking good. Forget Falcon, that was ‘old Ford’.

What about all the Ranger variants, and small/compact/large SUVs which began arriving as Ranger caught on with the buyers?

That was another accident of good timing, so don’t laud Ford’s senior management – once again, it was the market that saved the company, not enlightened vision in the executive suites – either in Broadmeadows or Dearborn.

And let’s not forget Ford’s happiest ‘accident’ yet – The Ford Mustang. Selling its pants off, and definitely another nail in Holden’s coffin!

I’m betting the Ford suits still employed by Ford Australia, simply breathed a collective sigh of relief when things turned around, and set about releasing more and more sexy versions of the Ranger, which is now hot on the heels of Toyota’s Hilux.

John Crawford

CARLOS GHOSN COLLIDES WITH JAPANESE CULTURE. AGAIN! by John Crawford

Never. Never, get between the Japanese culture, and ‘Loss of Face’.

The nation considers itself a ‘Samurai Culture’ and even your most humble Japanese public servant, or clerk at Nissan, considers themselves a Samurai at heart.

What do you think drove perfectly intelligent pilots to wilfully commit Hari Kiri during WW2 to become Kamikaze and crash their planes into American warships? They were sacrificing their lives to their country and their culture.

And so we come to Nissan’s court case to claim $91 million from Carlos Ghosn, for the ‘humiliation, loss of revenue and fraudulent activity’.

This is nothing more than Nissan and the justice system attempting to put a brave face on the fact that Ghosn, skipped custody, escaped the vicious Japanese justice system, and fled the prospect of being kept under house arrest for years, if not a decade – and punishing the man who (in their eyes) brought shame on the company (which he saved from disappearing into oblivion).

Hiroto Saikawa

This court case is going nowhere. It’s a display of ‘samurai justice’, to avoid ‘Loss of Face’ – a most serious consequence for Japanese culture.

And the person, perhaps unwittingly, driving this pursuit of Ghosn is the now-disgraced former CEO of Nissan, Hiroto Saikawa.

The fact that the rest of the educated and knowledgeable world outside Japan knows and understands this fault-line in the Japanese culture, does not seem to dissuade them from ‘trying it on’. Yes, they live in 'a bubble'.

I’m sure they know this court case is futile, but the Japanese have to do something to bring dishonour on the man who ‘shamed them’.

John Crawford

IT'S OFFICIAL - HOLDEN JUST DIED! by John Crawford

No fanfare; not even a mournful ‘Last Post’; no wake; just a press release:

General Motors announced today in Detroit  that it would wind down sales, design and engineering operations in Australia and New Zealand and retire the Holden brand by 2021. 

"I've often said that we will do the right thing, even when it's hard, and this is one of those times," said GM Chairman and CEO Mary Barra (right). 

"We are restructuring our international operations, focusing on markets where we have the right strategies to drive robust returns, and prioritizing global investments that will drive growth in the future of mobility, especially in the areas of EVs and AVs.”

So, that’s it. Holden is dead and gone.

After 72 years the umbilical cord to Detroit has been severed and with it all the remaining jobs, and the dealer network. Even the much-revered Holden Design Studio in Melbourne, and even the fantastic proving ground at Lang Lang southeast of Melbourne.

Aussie icons: Holden (gone); Sydney Opera House; Sydney Harbour Bridge (survivors)

Also gone are GM’s assembly plants in Thailand and India, plus a restructuring of operations in Korea. Years ago, I wrote about Chair Mary Barra leading a retreat back to Fortress America – abandoning brands, investments, workers and facilities in order to ensure General Motors traded profitably, and more important from its point of view, so it could retain the ability to direct its resources into future vehicles like EVs and AVs.

The announcement was much more far-reaching than even I expected. I thought the Design Studio and Lang Lang would survive, as countless suits at GM, including President Mark Reuss said, ad nauseum, how important these two GM outposts were to the core of the corporation’s design and engineering future.

Mysteriously, the words coming out of Detroit spoke of working with ‘its partner’ to develop the GM range of ‘specialty vehicles’. So, I’m guessing GM could sign up for a distribution agreement with a company like Inchcape, to distribute the Chevy Camaro and Corvette, plus the Chevy SUVs and the Buick Acadia. I mean, there’s obviously a market for rev heads and mud pluggers with families, so why not take advantage of it.

Although, as my industry 'conscience', Wayne Webster pointed out the statement also referenced pulling out of all RHD markets. So I guess that probably does mean no Corvette C8s and Camaros for Oz.

No, I am not surprised. My view was that it was a case of ‘when’, not ‘if’. I am, however, surprised how deep the cuts go.

GM says it is budgeting for USD$1.1 billion plus to sever its connection with the dealer network and the remaining Holden offices and staff.

Valé Holden. Rest In Peace. It’s been good to know you.

John Crawford