GM Holden has confirmed it will retire its Family II export range of four-cylinder engines. Production of the engine will be wound down between now and the end of 2009. The cessation of the engine line will force the closure of part of the company's engine building operation at Port Melbourne and could cost over 500 jobs.
The announcement was made officially late this afternoon, but was first leaked to the media earlier in the day by AWU officials. According to Holden the decision was formally signed off in a board meeting early this morning.
GM Holden boss, Mark Reuss (pictured), fronted a relatively small media contingent to make the announcement. He said overseas markets across the GM globe would dry up for the export-only engine by the end of 2009. This would include demand for the engine range from Korean affiliate, GM-DAT -- formerly Daewoo.
The Family II range of engines has not featured in a locally-built Holden since the demise of local Vectra production in 2000.
"Every product has a lifespan and Family II is an older cast iron engine which has been around now for 27 years. It has served GM well but is now coming to the end of a very long and successful life," Reuss said.
"Our remaining markets for this engine are all overseas and our export customers have advised us that with newer and more technologically advanced four-cylinder engines available within GM, they do not require production from GM Holden beyond the end of 2009."
According to Reuss, GM Holden will work to redeploy a percentage of the 531 Family II line workers and iron foundry staff affected over the next 18 months. The 550 (approx) workers that remain at the Holden Engine Company plant -- including those on Holden's Alloytec HFV6 engine line -- are not affected, he said.
Holden's Executive Director manufacturing Rod Keane, also on hand for the announcement, said the number of workers redeployed would depend on the fortunes of the V6 engine line.
"That [the percentage redeployed] is very much dependent on the success of our endeavours with the High Feature V6 brand. I don't want to give anybody the impression that we can absorb all of them -- that is not the reality. But in truth there is certainly some opportunity to absorb a significant number," Keane said.
Keane said he also expects a number of voluntary redundancies will facilitate the process.
Over 4.8m Family II engines have been built at Port Melbourne since the engine was introduced in 1981. According to Keane around 4.4m of those have been exported.
At the peak of production the plant shipped 1500 Family II engines per day to markets in Asia, the Americas, Europe and Africa. Currently the line builds less than 500 units per day.
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