Holden: Made in Korea!

SOUTH Korean-built Daewoo vehicles wearing Holden badges will hit Australian roads before the end of this year.

That’s right: Australia’s top-selling automotive brand has announced it will import vehicles from General Motors’ South Korean operations (GM Daewoo Automotive & Technology) later in 2005.

The announcement confirms what has been widely speculated since Holden last year announced it would cease Australian sales of Daewoo, 43 per cent of which is owned by Holden Limited, with both companies under the GM umbrella.

As reported by GoAuto last year, it is believed decreasing sales of Daewoo in Australia, combined with the Daewoo brand’s marketing and dealer network costs, are behind the more resource-efficient plan to distribute Daewoo vehicles through Holden’s existing infrastructure.

Holden’s announcement follows Toyota Australia’s decision last month to wind down its Daihatsu subsidiary brand by March next year, due to limited sales potential in the over-populated light-car market, in which vehicle profit margins are counted in hundreds, rather than thousands, of dollars.

In what could prove a similar move, Toyota Australia has not ruled out selling Toyota-badged vehicles from either Daihatsu or its US-market youth brand Scion.

Holden chairman and managing director Denny Mooney announced the plan at the launch of the Holden-made Daewoo Statesman to Korean press in Melbourne yesterday (April 12).

"Holden can take advantage of GM’s South Korean capability in design, development and manufacturing to expand its portfolio later this year," Mr Mooney said.

Holden refuses to comment on which Daewoo models it will import, where they will fit into the Holden range and when.

However, Holden sales and marketing boss Ross McKenzie last week confirmed that Daewoo-built Holden imports will begin when supplies of the previous-model, Polish-built TS Astra Classic dry up in the second half of 2005, in an effort to counteract lost sales of the popular entry-level small hatch and sedan, which played a vital role in Holden’s overall market dominance last year.

"The Classic departs the scene in pretty much a seamless transition to move into the Daewoo product," Mr McKenzie told GoAuto.

"That transition to the J-car product out of Daewoo, we think, will give us enough momentum to keep the numbers going."While Holden is on record as saying it will import Daewoo’s S3X medium 4WD as a possible replacement for its current VZ Commodore-based Adventra all-wheel drive wagon beyond the next-generation VE Commodore in 2006, Mr Mooney has indicated the likelihood of a light car positioned below Barina and a medium car below Vectra.

"(As for Daewoo), there’s no question – we want to strengthen our four-cylinder line-up and our four-cylinder reputation, and we will continue to look at what I call the total GM product portfolio for opportunities of products which might fill some of our holes," Mr Mooney told GoAuto last year.

"I would say (a light car and medium car) are under consideration as I would say we’re looking at everything in the GM portfolio right now – trying to find the right product fit for our brand."Whether the likes of a Holden-badged Daewoo Kalos – with styling input from ex-Holden designer Max Wolff and chassis tweaks by South Korean-based Holden engineers – will be offered alongside the current Barina range, or whether it will replace Barina altogether, is still unclear.

Alternatively, Daewoo’s recently unveiled Matiz replacement an outside chance to be sold as a Holden in the sub-$15,000 market.

It’s also likely that a five-door version of Daewoo’s J200-series Lacetti small-medium hatchback – which had been delayed for Australian sales until August 2004, until a larger, 2.0-litre engine was made available – will join the Holden range between the new AH Astra and ZC Vectra mid-sizer.

While South Korean vehicle sourcing allows Holden to fill gaps in its model line-up and enter market segments in which it does not currently compete, Holden spokesman Jason Laird told GoAuto that any new models would offer more changes than just a Holden Lion badge.

"Our decision with Daewoo brand focussed on the underlying fact that the products were sound in the marketplace, but the public had formed the view the Daewoo badge was undesirable," he said.

"A Holden badge on those products will undoubtedly make them desirable and we have an opportunity to make those cars, both existing and forthcoming, available here.

"(But) they need to feel and look like a Holden and represent everything the Holden brand stands for. We have to be stringent about what carries the badge. Any car which wears the Holden badge, as a no-dispute, must have Holden drive characteristics."

Mr Mooney (left) concurs: "It’s got to be worthy of the Holden brand, it’s got to be upscale enough, it’s got to have the vehicle performance levels that we would be confident that a customer in that segment would say: ‘Yeah, this feels like a Holden.’"A GM Daewoo board member, Mr Mooney said yesterday: "We have design personnel located in Korea and Holden engineering will be involved in areas such as chassis and engine performance.

"The GM Daewoo-sourced vehicles will offer great value, high quality and the excitement Australian customers expect from Holden."Holden already exports vehicles and four-cylinder engines to Korea and the company says the decision to import cars in return will strengthen the relationship between two of GM’s key family members in the Asia Pacific region.

"GM Daewoo designs, develops and manufactures high quality vehicles for a number of brands around the world. Those cars compete against the best of the best around the world and in every market they have entered they have been successful," Mr Mooney said.

* GM’s European subsidiary Opel has announced a more efficient new 103kW/175Nm 1.8-litre petrol engine that will eventually appear in Australian Astras.

While Holden spokesman Jason Laird yesterday said he was unaware of the new engine, an Opel press release has revealed the new Ecotec 1.8 would first appear in Zafira around mid-year, followed by Vectra and other Opel models "in the near future".

While Australian Vectras and Zafiras are powered by 2.2-litre fours, the new 1.8 offers significant advances over the current AH Astra’s 90kW engine, which was carried over from the previous TS model.

It features 14 per cent more power at 103kW, a four per cent reduction in fuel consumption, more flexibility and refinement, continuously variable camshaft phasing and a two-stage intake manifold.