The Australian federal government has hopped on the auto bailout bandwagon, “investing” $149m in production of a Holden-badged GM compact car. The South Australia state government will kick in $30m as well, as the Delta-platformed Cruze-alike will be produced near Adelaide. Styling and engineering will be carried out in Melbourne. And what do the Australian people get for their representatives’ fiscal abandon? According to Adelaide Now, the project will “support” 600 GM jobs and 600 supplier jobs, but it seems that these will likely not be new hires. Money for the project comes from Australia’s “Green Car Innovation Fund,” and its use is being justified by the possibility of ethanol, LPG and CNG powertrains at some indeterminate point in the future. “We recognise the needs and desires of motorists are evolving with growing concern around environmental factors and shifting consumer sentiment,” says Holden Chairman Mark Reuss. “Such evolution calls for an innovative approach… (and) the new vehicle will cater for growing demand for smaller cars focussed on economy.” when all is said and done though, the environmental issues are simply a greenwash for Australia to prop up weakening production and subsidize a “domestic” Corolla competitor. Sound familiar? The irony is that the GM doesn’t especially need a bespoke version of its global Cruze for Australia, although it will be required to match the government’s $149m outlay.

(Read More…)

Think Australian cars and you're likely come up with three words: large, RWD, sedan. Well, Ford CEO Allan Mullaly has turned the land down under upside down by suggesting that the next Falcon might be a front-drive model. The Motor Report gasps at the announcement, but with the new Falcon FG selling slowly, it seems large rear-drive sedans are going the way of the SUV in this country. Mullaly's pronouncement that the decision would "be driven by what the customer wants and values" has Aussie hoons hoping they still have a chance to stop the cruel march of progress. In the real world, rumors that the new Falcon could be a global platform suggest that it will almost certainly be FWD. Mullaly also gently broke the news that in the long term, V8s would be less prominent in the lineup thanks to Eco-boost. Of course the quantifiable benefits of an FWD platform are numerous. Besides the greater global flexibility, an FWD model would offer more interior space and efficiency for less money. GM's Holden brand has probably saturated what few niche markets exist abroad for the Aussie formula of cheap-and-cheerful, drift-happy muscle sedans. In decisions which reflect their general strategies, GM has gone for the marginally-profitable gusto by bringing its Aussie RWD V8 sedan stateside as the G8, while Ford plays it safe by (probably) globalizing its Aussie throwbacks. From a business perspective, it's hard not to prefer Ford's approach. As an RWD nut, well… change can suck.

Memo to car manufacturers: naming contests don't work, except to grind my gears. It didn't work for Alfa Romeo, who had to ignore contest results for the car we now know as the MiTo (fan chosen name was Furiosa). And now General Motors has revealed that the production name of the Pontiac G8 ST concept – a "sport pickup" version of the Australian Pontiac G8 – will be the Pontiac G8 ST. Jalopnik's Jalops went so far as to hand out buttons calling for an El Camino revival. While that moniker might not have been GM's best call– it's a Chevy name– neither is G8 ST. Then again, with the G8 ST being a niche within a niche, big diff (no LSD implied). The name choice really does show, however, GM's incredible ability to minimize the impact of a car when it comes to market– especially one they've been talking up for the last twenty-some years. This really smacks of the Astra: an overseas product that car lovers craved that GM eventually pushed it into the corner. Same with the Commodore-cum-G8 (at least that one got a few TV commercials). And when it goes on sale in late 2009 (another year wait? are they kidding?), the G8 ST sport truck is likely to be yet another victim of GM's monumental ADD.

By some accounts, the new Australian Ford FG Falcon is a good car. It's said to have earned Ford Australia the right to develop Ford's new global rear wheel-drive (RWD) architecture. Former Lexus driver FoMoCo CEO Alan Mulally claims he covets the G6E Turbo model. So it's selling well, right? In a word: no. The Australian reports that the FG Falcon has "flown into a perfect storm, with high petrol prices and tumbling trade-in values conspiring to slam the brakes on sales of the new large sedan." Though sales are technically up eight percent over last June, Ford has moved only 4k of the new RWD sedan since its launch two months ago. There's been no appreciable bump typically associated with all-new products. Even Ford Australia boss Bill Osborne is worried: "The underlying market for large cars is even weaker than what was on display in June, and that's cause for concern for us." Ford is confident that they can "build momentum" because turbo models weren't available at the launch, but they also won't rule out layoffs or production cutbacks because they "don't know where fuel prices are headed." Anyone want to help them out on that?

The car we know as the Pontiac G8, you probably already know is a twin of one of GM's Australian bread and butter cars, the Holden Commodore. They've got all sort of variations of it over there – El-Camino style sport trucks (yes Jalopnik, we know), station wagons, AWD models, long wheelbase luxury versions, and yes, in-house specially-tuned high-performance professional ass kickers. We'll be getting one of the latter category of INSTHPPAK models as the Pontiac G8 GXP with a 400 horsepower 6.2 liter V8 out of the Corvette. But that's not enough if you're properly power hungry. Holden's HSV tuning folks presented the 7.0 liter (they call it a 427, because they are that badass) LS7 powered murderer version of the Commodore. Not only that, but in the ultimate act of hilariosity, the HSV W427 model as it's called will be available in the stretched luxury car called the Statesman. Like the Corvette Z06, the Holden W427 will have a hair over 500 horses and 472 lb ft of torque. Holden is building only 427 examples of the car, and they cost $150,000 AUD. That makes it 3.5 times the cost of a V6 Commodore (which is the $27,000 G8 V6 in America), but about the same price as BMW M3 in Australia. Still a hell of a bundle of cash.  [Source: Holden ]

Click here , here and here for aural sex. 

Toyota recently declared that it would begin building Camry Hybrids in Melbourne, potentially reversing the industry's decades-long decline. The announcement vindicated the Australian government's half-billion dollar initiative to encourage local production of full-sized eco-friendly cars. PM Kevin Rudd and the Victoria provincial government each cut a $35m check to Toyota in return for its promise to build 10k Camry Hybrids per year. Win-win for all concerned, right? And then Toyota Australia spokesman Mike Breen opened his big mouth. Breen told The Australian an inconvenient truth: Toyota would have built Camry hybrids in Melbourne with or without the taxpayer-funded incentives. This prompted howls of outrage from the opposition, claiming the handout "amounts to nothing more than a $35m photo opportunity for the prime minister." Of course, Toyota has since backpedaled, disingenuously demurring that "Toyota's decision to build a hybrid Camry in Australia was based on various business considerations… however, the Governments' support was a critical factor in securing local production." Ford and GM reps are sure to learn the lesson when they meet with Australian Industry Minister Kim Carr this week; there's still $465m in taxpayer dross to be hustled Down Under.

In our latest editorial on Australia's tanking car industry, I noted that a government report emphasizes future production of large vehicles with green powertrains. The Australian reports that the Aussie government's half-billion dollar green car manufacturing fund could be used to lure production of the next-generation Toyota Camry hybrid down under. Toyota Australia VP Dave Buttner says ToMoCo had been pushing to build a hybrid car here for five years but "policies conducive to investment" (a.k.a. public money) were vital to the plan. The plan seems to convenient to avoid: Aussie politicians get to check of the box next to "build large, green cars" on their bureaucratic checklists, and Toyota gets enough money to offset Australia's high labor costs and strong currency. Oh, and Toyotas actually sell well in the land of Oz as well, especially the Prius, who's sales rose 63 percent last year. So who loses out in all of this? Just Toyota's competitors and Australia's taxpayers.