Senator Kim Carr is confident Holden will still be making cars in Australia well into the 2020s as long as Labor wins the election. If, on the other hand, the Coalition wins, it could be in doubt, he said on Friday.
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The rusted-on Rudd supporter, who returned to cabinet as Minister for Innovation, Industry Science and Research after Julia Gillard lost the leadership, rejected suggestions General Motors was concerned about ''sovereign risk'' in Australia and may choose not to develop another Commodore as a result.
Australian Automobile Association executive director Andrew McKellar said sovereign risk had emerged as an issue when the Gillard government axed the Green Car Innovation Fund and the so-called ''cash for clunkers'' scheme after the Queensland floods and cyclone in 2010-11.
The former Liberal aide, Coalition ministerial adviser and, until mid-2011, head of the Federal Chamber of Automotive Industries said matters had been further exacerbated by the $1.8 billion tax impost created by recent changes to fringe benefit tax on company cars.
''That came out of left field,'' he said. ''It wasn't something anyone in the community was advocating. It was not part of a broader reform, it was a piecemeal, narrow and poorly thought-through cash grab to cover a backdown in the carbon tax.''
Senator Carr disagrees: ''There is not one skerrick of truth in talk of sovereign risk,'' he said. ''We have had good relations with Holden's local management and worked with the international managers [during the global financial crisis].''
While Senator Carr would not comment on just how close run a thing keeping Holden in Australia had been, he said those relationships had played a big part.
''I insisted they be on the A-list,'' he said. ''I travelled to Detroit and there were lots of phone calls.''
While the government is committed to paying $1.5 billion in assistance to Holden and Toyota between 2011 and 2015 with a further $1 billion pledged for 2015 to 2020, the Coalition is less generous. It has said it would cut the first round of funding by $500 million and launch a Productivity Commission review into the industry.
Senator Carr, who said Holden workers would vote on a wage deal crucial to the company's survival on Tuesday, said Holden was deferring a decision until after the election.
''General Motors is waiting until the Australian government's position is finalised,'' he said. ''Is Tony Abbott committed to the future of the car industry in Australia? That is the question he has to answer.''
Senator Carr does not have a problem with spending money to attract investment and secure jobs. He is visiting component makers handing out relatively small business grants that lock in investments in new technology and processes.
''Nowhere in the world does a car industry exist without government co-investment,'' he said.