"Outside importers have an advantage": GM chief Daniel Akerson said there were many reasons behind the decision to cease Holden manufacturing in Australia. Photo: Reuters
The outgoing chief executive of General Motors, Daniel Akerson, has declined to say whether or not potential changes in the subsidy regime had an impact in the company's decision to cease manufacturing in Australia.
Speaking after a function at the National Press Club in Washington, DC, he told Fairfax Media, "There were so many factors in that decision, but basically you have a low tariff economy, so outside importers have an advantage, you've got a strong Australian dollar and you've got a supply chain... that is getting weaker."
Asked if government subsidies played a part Mr Akerson said, "I don't want to go into that."
He said wages were always a consideration, especially when there were comparatively lower wage economies in the region.
Coming a week after he announced his resignation, Mr Akerson's lunchtime address at the Press Club was seen by many as part of a victory lap.
In prepared remarks Mr Akerson announced the company was preparing to invest US$1.3 billion ($1.5 billion) in five US plants.
"This will bring the four-year total of investments in our US plants to more than $10 billion," he said. "About 7500 people already work in these plants and today's announcements will create or retain more than 1000 jobs."
He boasted that since it was bailed out by the US government during the economic crisis General Motors has posted 15 straight profitable quarters, reduced debt, streamlined operations and improved its products and customer service.
"We have been fixing the plane while it's in the air."
More than 26,000 workers have been hired or retained at GM due to the company's reinvestment in its plants, said Mr Ackerson.
"As you can imagine, this is welcome news, especially in communities where hope and optimism were in short supply five years ago," he said in the remarks. "Thanks to the swift and courageous action by two different administrations, the entire US auto industry is back."
An hour and a half before Mr Akerson rose to speak the conservative National Legal and Policy Center [NLPC] held a press conference at the Press Club, tossing a series of provocative queries at Mr Akerson and his successor, Mary Barra.
Peter Flaherty, president of the NLPC, challenged General Motors to pay back the $10 billion the US government lost after it sold its last shares in the company earlier this month. Noting the company now boasts $26.8 billion in cash and liquidity of $37 billion, Mr Flaherty said the company should prioritise refunding taxpayers rather than buying back stock or instituting a dividend, something the company has not done since before the financial crisis.
The company's massive cash hoard has led to speculation that it will soon pay a dividend for the first time since the government intervention. It is thought this has contributed to GM's surging share price.
Mr Akerson said the company needed to maintain a "fortress balance sheet" to protect the company if hard times return.