Monaro: reborn in the USA?

Posted by the Sydney Morning Herald, 03/03/06

A new Holden coupe is coming but exchange rates will determine whether it is made in Australia or North America, reports JOSHUA DOWLING.

The Holden Monaro is not dead after all. It will be reborn in late 2008 and could be built on the same production line as the iconic Chevrolet Camaro.

The next generation of Australia's biggest-selling coupe was cancelled last year when Holden's parent company, General Motors, announced that it had to rationalise its future model program and focus on big-selling, high-profit four-wheel-drives and pick-ups for the US market.

But GM's head of global product development, Bob Lutz, told Drive at this week's Geneva motor show that the next Monaro's development program had stopped for only two months and it was now "back on, at full tilt".

"The reason we said it was cancelled is because that way people would put their pencils down," Lutz said. "In GM if you say something is deferred, then people keep working on it. We really needed to get that message through to everybody."

He said the program was "getting out of control" and costing too much.

Lutz said that the program was "only ever off for two months but that break has enabled us to get a more feasible program up".

Lutz said the strength of Australia's currency would be the deciding factor in where the next-generation Holden Monaro was built. General Motors is considering building the Monaro - due in late 2008 - in the US, where the coupe will also be sold as a Pontiac GTO (and where it has been sold in far greater numbers than the Monaro over the past three years). Both the next Monaro and Camaro would share most of their underbody components with the new VE Commodore due in August this year.

"Whether the Monaro will be built in Australia will largely depend on the exchange rate at the time," Lutz said. With the current strength of the Australian dollar and the recent Free Trade Agreement between Australia and the US, it would be more feasible to build the Monaro in the US and export it to Australia, he said.

Holden will still be heavily involved in the development of the next Monaro and the new Camaro, if that car is approved for production.

"Holden is responsible for the large rear-drive architecture that these cars are based on. If it happens, Holden will do the development on the Camaro as well as the Monaro," Lutz said.

Asked if the Camaro would be built in right-hand drive and sold in Australia, Lutz said it was "not in the official program".

"But the Australians are doing that car - if it goes ahead - so I think the right-hand-drive version will eventually just sort of happen."

Production of the current-generation Holden Monaro came to an end late last year and the last of the Australian-made US-bound Pontiac GTO versions of the Monaro is expected to roll off the Adelaide production line later this year.

The flexibility for General Motors to manufacture cars in any of its factories around the world highlights a new level of efficiency for the world's biggest car maker.

That means Holden's expertise could be used to build cars in Korea or the US. Indeed, earlier in the week, Lutz candidly suggested that the Holden Commodore or Statesman could one day be built in Korea.

"It's not planned but it's possible and it's feasible," he said.

General Motors owns Korean brand Daewoo and its car-making operations and in October 2002 Holden became the biggest stakeholder in the company, buying a 42 per cent share, which it is understood has since grown to 46 per cent.

While Lutz said Holden has no plans to close its vehicle assembly factory in Adelaide, he added that the Australian industry was "at risk" of being uncompetitive with its nearby Asian neighbours, which have lower labour costs.

"I tell you the Australian manufacturing industry is in a difficult situation right now," Lutz told the Herald earlier this week. "If the government doesn't do something about it or the Australian dollar doesn't weaken then I'm not sure what's going to happen. The Australian market really is at risk."

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