“Zero debt” Holden remain confident despite $153 million loss
Holden’s Chief Financial officer has addressed the company’s latest financial results directly in a blog posted on the company’s website and circulated via Twitter by, amongst others, the company’s Senior Manager, PR & Technology Communications, Andrea Matthews. (@AndreaMatthews)
George Kapitelli, Holden's Chief Financial Officer
In his blog, George Kapitelli, admits “how tough it is to compete in Australia,” as the company published a net loss after tax of $152.8 million.
He said the loss was driven by the costs of restructuring the business and revaluing its manufacturing assets to match lower production volumes. He also said the high Australian dollar reduced the company’s ability to advertise its products.
“Holden is particularly trade-exposed. Sixty per cent of the cars we sell in Australia are made in Australia. When the Aussie dollar goes up, overseas vehicles become cheaper and car importers have more margin to play with; to compete with, to reduce their prices, to add more content, or spend more on advertising,” he said.
When you make cars in Australia you don’t have this luxury – your manufacturing costs are largely fixed, you have to find ways to be more efficient, to reduce your margin simply to compete with imports.”
He emphasised that Holden had “a strong and healthy balance sheet with zero debt”, and added that marketing and PR efforts were helping to sustain sales.
“As you would have seen from last month’s national vehicle sales we’re gaining traction in the market – Holden was back to number two in the sales race,” he said.
“We know our new marketing and product initiatives are having an impact and we’re confident we can tackle the challenges in the coming year head on.”