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Opel will still supply Holden, confirms PSA

By Ash Westerman, 05 Sep 2019 News

holden psa deal safe

PSA officials confirm that Holden deal to buy Commodore and Astra will continue

Everybody relax - Holden is not going anywhere.

That’s the take-out from an interview with senior Peugeot-Citroen (PSA Group) executives in Sydney, who dismissed rumours of a Holden takeover by their Australian distributor that surfaced in February, insisting that it's business as usual for PSA-owned brand Opel in terms of supply contracts for the Holden Commodore and Astra, both Opel-built vehicles. 

The source of the original story was the Australian Financial Review (AFR) which published claims early this year that Inchcape, the UK-based distributor for Subaru, Peugeot and Citroen in Australia, was appraising the Holden business with a view to attempting to buy it from US parent company General Motors, and add it to its portfolio.

The story gathered momentum when both Holden and General Motors were slow to address the issue and Inchcape declined to comment.

MORE Holden owners GM to leave Australia?

In 2017, Peugeot-Citroen group (PSA) bought General Motors’ European brands Vauxhall and Opel, the latter of which supplies the Holden Commodore sedan and wagon and Astra small car, giving rise to speculation as to what it could mean for the Holden/Opel deal.

It wasn’t until nearly a week after the AFR article was published that Holden boss Dave Buttner told dealers that the report was “pure scuttlebutt”, adding that he “did not join the company to close Holden”.

Speaking with Australian press in Sydney, Emmanuel Delay, PSA’s executive vice president and operational director for India and the Pacific (below), assured WhichCar there has been no discussions regarding a takeover of the Holden brand, no plans for a reintroduction of Opel in Australia, and he saw no foreseeable interruption to Holden’s supply deal.

Emmanulle Delay PSA Group 2019

Emmanuel Delay

“Firstly, we should not tell you anything but the answer is no,” he said.

“We have a current supply contract selling Opel-made cars to Holden; [the] Astra and Commodore. That’s all that exists and this is just a result of the acquisition of Opel by PSA.

“Holden needed to continue supply and so they asked us to continue supplying those cars that they badge as Holdens. That’s all there is.”

2017 Holden Astra R

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“There is a commercial agreement for a certain period. It doesn’t mean that after that period that you cannot extend that contract. It could go longer,” he said of the Holden deal.

Mr Delay said that he didn’t know the exact date of the expiration or potential renewal of the Holden deal, but “typically when you do these [type of] contracts you do it for two or three years."

"It depends on the interest of the buyer [Holden]. If the buyer wants a long-term commitment from the supplier then they will ask for a long-term contract and they will define the quantities and so on,” he explained.

MORE More opportunities for Holden after Opel sale

“The details I don’t have, but it’s very normal and it’s ongoing. It needs to be win-win,” said Mr Delay. “If the (buyer) of the cars needs the cars, they will secure cars and the supply quantity for a certain period. Normally the seller is always happy to sell cars and make (a profit).”

The Commodore, like the rest of its sedan-based competitors, is facing a stiff headwind when it comes to local sales, with the latest VFACTS sales figures recording a 25 percent slump in month-on-month sales and a 36 percent drop over the same time in 2018. It still heads the diminutive large car category with 4220 sales for the year, over the Kia Stinger's 1266.

It's expected that Holden will streamline the Commodore line-up before the end of 2019 in response to the softening demand.

The Astra is in a bit more strife, posting just 571 sales in August against the Toyota Corolla's category-topping score of 3033. Its sales are off almost 34 percent month-on-month, and 35 percent year-on-year. Some 3630 Astras have found Aussie homes thus far in 2019.