GM's Asia-Pacific boss - who made the recommendation to shut down Holden's local operations - talked to Drive at the 2014 Detroit motor show.
Coalition frontbencher Christopher Pyne has seized on comments made by General Motors boss Stephen Jacoby as vindication over the federal government's policy towards Holden.
Mr Jacoby told the Detroit Motor Show that Holden had made the decision to stop manufacturing in Australia independent of any government funding - or reduction of funding.
Mr Pyne jumped on the comments on Tuesday, telling reporters in Canberra that they undermined Labor South Australian Premier Jay Weatherill's argument that the Coalition had goaded the car manufacturer out of Australia.
"Jay Weatherill had planned to run his whole [state] election strategy around blaming the federal government for the economic woes in South Australia. Today we have found out that in fact, Holden made the decision entirely of its own to close its operations in South Australia and in Victoria," Mr Pyne said.
"Jay Weatherill stands condemned. He should apologise to the South Australian voters and start telling the truth about his own failed government."
The man who made the call to end Holden's 65-year history of car making in Australia says it is impossible to make a case to build cars locally as trade barriers are brought down and the market continues to fragment.
Speaking at the 2014 Detroit motor show, GM's Asia-Pacific boss Stefan Jacoby painted a grim picture for the sole remaining Australian car maker, Toyota, which is expected to make a decision on its manufacturing future in Australia by mid-2014.
"Since the market is so open with more free trade agreements coming up ... it is more or less impossible to truly manufacture vehicles in Australia on a competitive basis," said the executive vice president of GM's Consolidated International Operations. "It is impossible. It's fundamentally impossible to produce, regardless of what the government is saying [in terms of industry assistance]."
Jacoby pointed to the size of the Australian market compared with rivals, particularly those nearby in Asia.
"Our automotive business is driven by scale of economics, of productivity, of an efficient supply industry, of sufficient and efficient and optimised logistics and that mean that the automotive industry will be focused on core markets ... and Australia is just too small in respect of these scales."
Reiterating recent announcement a Toyota spokeswoman said: "Recent factors have put our manufacturing operations under unprecedented pressure. We are now studying all relevant business impacts and a decision will be made on future investments sometime this year."
Despite weeks of political, media and industry analysis and finger pointing, Jacoby - who recommended to the General Motors board that the Holden manufacturing operations in Melbourne and Adelaide be shut down - said pre-Christmas pressure from the government for Holden to make a call did not sway the final decision. He said the decision was made hours after Holden boss Mike Devereux presented to the productivity commission on the morning of 10 December.
In a move some will say is designed to appease the federal coalition government as Holden embarks on a costly politically-charged exit from the country, Jacoby is adamant it was not calls in parliament for Holden to show its hand but business rationale.
"We made this decision independent of the Australian government to support the auto industry," he said, adding that GM was not "gambling" with the by government to secure more financial assistance, despite a campaign that went on for years calling for long-term assistance.
"It had been a business decision. The decision was not made on any [government] incentives or any reduction of incentives ... It was a purely business-driven decision. We discussed all alternatives and at the very end we came up with the decision to withdraw."
A spokesperson for Treasurer Joe Hockey echoed Jacoby’s remarks, saying that Holden’s decision was irrespective of which government was in power.
“Bill Shorten and Jay Weatherill have been called out by General Motors for their foolish behaviour in asserting that Holden would not have left Australia under Labor. The reality is that for six years under Labor one manufacturing job was lost every 19 minutes
“As the comments from Mr Jacoby reinforce – this was a business decision that wasn’t made on the basis of any government incentives.”
However, shadow Industry minister Kim Carr said the Coalition played some role in Holden’s exit.
“Joe Hockey's bullying and hectoring did not go unnoticed in Detroit,” Senator Carr said. “Whatever peacemaking efforts are now underway do not change the facts.”
On Tuesday, Opposition Leader Bill Shorten said that the government was continuing to "treat Australian jobs and the livelihood of workers as a game".
"They have spent more time trying to justify their own inaction over Holden than they ever spent trying to protect Holden jobs," he said.
When asked if former Coalition government should take responsibility for the demise of the car manufacturing industry, due to their support of free trade agreements, Mr Pyne replied that free trade was a "global phenomenon".
"Australia has been a pro free trade country since the debates between the debates between the protectionists and the free traders in the last century," he said.
"I don't think [Mr Jacoby's] saying General Motors decided to close their operations in Australia because of the attachment that the Australian governments of both Liberal and Labor persuasion have had to free trade over generations."
Jacoby also hit out at those who claimed his decision to visit Australia weeks before the announcement without meeting with any government representatives was an indication GM had made up its mind on its Australian operations long before its December 11 announcement.
"That is wrong because I was in South Africa, I was in India, I was in [South] Korea and I was in Thailand and I didn't meet any unions or any government officials there as well," he said. "It was my first trip to Australia in my new role and I was focusing on the business and I was test driving cars, and that took two days and that was my scope of my business over there. I never had it in mind to meet any government officials or any unions."
In describing the decision to end Australian manufacturing Jacoby said it was a "very difficult decision for General Motors" to make.
The decision was made on Jacoby's recommendation.
"I initiated this decision, obviously, being the leader of these markets," said Jacoby, pointing out that was only a recommendation and it required board approval.
"It was the decision which of course the CEO and the chairman of the board had to do," he said. "You cannot say who made the decision, there are several layers. I proposed that decision ... there was a CEO and executive team decision and the final decision came from the board.
"After that hearing in the productivity committee (Productivity Commission) I think we had all the elements together, it was a very serious decision ... After the hearing we had all the bits together and we made that decision.
"It had high top management awareness and involvement. It was a proposal the executive team, led by [then GM chairman and CEO] Dan Akerson, made. There had been an extraordinary board meeting where this decision had been made that the executive team could execute this."
However Jacoby said the decision to end Holden's long running engineering involvement in Australia was taken ahead of the decision to shut the manufacturing plants, even though both were announced on the same day.
"That decision had been made earlier," Jacoby said. "It's very much related to where we have engineering capability. We have [South] Korea as our major engineering hub for [Asian-based] Consolidated International Operation and also China, so we have engineering resources in our region."
While Jacoby conceded there would be a "transition period" from local manufacturing to full importation, he was diplomatically optimistic Holden could rebuild its waning market share.
"We will at least stabilise our market share if not grow our market share," he said. "Our objective is to define a strategy to compose Holden products in Australia with the global portfolio General Motors has and compete in segments Australian customers want and expect from a Holden.
"I think we made a clear commitment to stay with Holden in Australia. Our business model is different but we are committed to Australia."
- With Judith Ireland and David McCowen