In the wake of the shock announcement that Holden will disappear from the Australian automotive landscape, dealers are preparing to slash forecourt prices by more than $17,000.
The once-mighty lion brand will cease to exist by the end of this year, but dealerships are expected to bolt their doors for the final time far sooner, with massive discounts offered to clear out stock fast.
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Massive price cuts for all Holdens
Reports emerging suggest that the Holden Colorado will be the pick of the buys, with alleged discounts of up to $17,500, while the Holden Astra 2019 model - discontinued earlier this year - has also had its price slashed by some $8500.
However, WhichCar has learned that those prices are not as cut-and-dried as many are reporting. According to a source inside Holden, the company will be applying discounts on a more case by case basis, assisting dealers to move all existing stock.
The largest figures will be applied to sweeten the deal in the hardest of sales, like high-mileage demonstrators or yard-damaged examples.
The message is clear - don't expect to stroll into a Holden dealership and drive out in a new Astra for $12,000, while used examples are selling for $16,000.
That said, Holden will be offering "substantial bonuses on the entire range," WhichCar was told.
The strategy appears to be working, with interested customers already approaching dealerships with inquires. Dealers are confident the aggressive discounting strategy will be effective in clearing all stock before the end of the financial year.
Holden plans for dealerships still under wraps
While discount information has made its way to dealerships, detailed compensation packages ave not yet been forthcoming. Holden assures affected parties that one is on the way which will be satisfactory, although it's suggested that some dealers are still considering legal action if the proposal does not adequately support all of the circa-180 dealers.
Stiff penalties have previously applied if dealers wanted to back out of franchise contracts early, so the dealers are expecting similar compensation now the tables have been turned, said our source, with some dealers recently investing millions of dollars to secure long-term leases.
Holden is remaining tight-lipped on its exit strategy, including information on dealer compensation packages, but WhichCar understands most, if not all, dealerships will be shuttered by the end of August 2020. However, a statement by Holden executives on Monday suggested the 600 employees due for redundancy could be out of a job by June.
A complete cancellation of all local advertising is part of the media blackout, which is expected to cost media houses millions of dollars in revenue, while sports sponsorship deals with various sporting teams have also been cancelled.
Key Holden dealers affected include John McGrath Holden, Werribee Holden, Bay City Holden and Poyser Holden.
Either way, forecourts and showrooms around the country need to be emptied quickly, and customers in the market for a new car stand to be the ones benefiting out of Monday’s otherwise bleak announcement.
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While prices for new Holdens will be at an all-time low, potential customers are advised to go in with a long-term ownership plan, as resale values will be impacted once the final pin is pulled. Don’t expect to make a killing by flipping the car soon after purchase.
Conversely, values of older and more desirable Holden models are now expected to rise as the reality of an Australia without Holden dawns on many lifelong fans.
A spike in the demand for V8 and ute models followed the announcement that local manufacturing would end in 2017 and a similar increase in demand is possible following the most recent revelations.
Customers who have recently bought a new Holden may also benefit from the discounts if they haven’t yet taken delivery. If that applies to you, get in touch with your sales consultant as soon as possible and renegotiate the pre-announcement price.
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While it is a risk to buy a new car that will essentially become an orphan, it's unlikely that new car prices this cheap will ever be repeated.