Detroit, Michigan – General Motors is getting out of several Asia-Pacific markets by selling a plant in Thailand to a Chinese automaker, ending the Australian Holden brand, and ending Chevy sales in Thailand.
Holden is GM’s primary brand in Australia and New Zealand, and the brand has historically provided vehicles that GM has sold in North America. The last one, the Chevrolet SS (Holden Commodore), ran from the 2013 through the 2017 model years. Several U.S.-made Chevrolet vehicles, such as the Equinox, sell in Australia as Holdens.
Design and engineering at Holden will end by next year with sales to end soon after. Australia once had a thriving automotive production market, but GM closed its last plant there in 2017, about a year after Toyota and Ford ended production there.
China’s Great Wall Motors will purchase GM’s Rayong vehicle manufacturing facility in Thailand, allowing Chevrolet to withdraw from that country’s sales market by the end of 2020.
“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. “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 electric vehicles (EVs) and autonomous vehicles (AVs).”
GM President Mark Reuss said the company explored a range of options to continue Holden operations, but none could overcome the challenges of the investments needed for the highly fragmented, right-hand-drive market; the economics to support growing the brand; and delivering an appropriate return on investment.
“We have the deepest respect for Holden’s heritage and contribution to our company and to the countries of Australia and New Zealand,” Reuss said. “After considering many possible options – and putting aside our personal desires to accommodate the people and the market – we came to the conclusion that we could not prioritize further investment over all other considerations we have in a rapidly changing global industry.”
GM’s Thai plant had exported most of its production to nearby countries for years, but growing production capacity in China have lowered capacity utilization in Rayong. Reuss said Thai demand alone couldn’t support the plant, and GM couldn’t run it profitably for that country. And, without the plant in Thailand, staying in that country’s auto market didn’t make sense.
The Thailand and Australia decisions follow GM’s move to sell a plant in India and restructure operations in Korea and South America to compete globally. The company will continue to compete in China and Korea and considers South America and the Middle East key international markets as well.
The international changes will cost GM $1.1 billion in cash and non-cash charges against its earnings to write off the value of some investments.