1. COURSE: IBU5COV
Subject Coordinator: Dr Vanessa Ratten
Lecturer: Gemegin Kis
Email: g.kis@latrobe.edu.au
INDIVIDUAL ASSIGNMENT
Submitted by: Trang Vo Hoang Nguyen
Student ID: 18189216
Word count: 2,403 words
Submission date: 16/10/2015
STRATEGIC ALLIANCE BETWEEN HOLDEN AND FORD
NEW PRODUCT LAUNCHING PROJECT 2016 – 2020
COMMODORE – ECOSPORT

2. TABLE OF CONTENTS
INTRODUCTION............................................................................................................. 1
1. Background of General Motor and its subsidiary in Australia market – Holden........ 2
2. Recommended new venture proposal ......................................................................... 2
2.1. Venture description statement .............................................................................. 2
2.2. Marketing.............................................................................................................. 4
2.3. Operation and Management.................................................................................. 6
2.4. Financials.............................................................................................................. 7
2.5. Risk management.................................................................................................. 7
2.6. Harvest strategy .................................................................................................... 8
2.7. Milestone schedule ............................................................................................... 9
3. Summary ................................................................................................................... 10
APPENDIX 1.......................................................................................................................
APPENDIX 2.......................................................................................................................
APPENDIX 3.......................................................................................................................
REFERENCE LIST............................................................................................................

3. 1
INTRODUCTION
In an increasingly competitive market nowadays, corporate venturing is considered as the
most systematically productive way to enhance corporate performance (Jeffrey G. and
Morgan 2007). Therefore, after careful analysis of external, internal factors, this paper
wants to suggest the new venture for Holden to improve its current position in Australia
automotive market and increase sale revenues. The new venture idea is sounded risky
when cooperating with Ford – one of Holden’s big competitors in Australia market,
However, by presenting a clear plan with persuasive evidence on successful potentiality
of this project, the paper wants to provide the new approach and refreshed mind for
Holden’s growth in the future.

4. 2
1. Background of General Motor and its subsidiary in Australia market – Holden
General Motors (GM) is the multinational largest automotive manufacturer, which was
established in 1908 and headquartered in the US. Since 2010, GM has completed the
world’s largest initial public offering, emerging with a solid financial foundation that
allows it to bring more value to all stakeholders. Core competencies of GM include
people orientation that drives mutual respect, responsibility and understanding among
GM teams, customers, competitors and other relevant stakeholders; innovative
technology and strategic global partnerships to shape the future of the automotive
industry; environment and education priorities with the aim to give back to community
(General Motors 2015). Some typical brand names of GM are Chevrolet, Buick, GMC,
Cadillac, Baojun, Isuzu, etc. which are categorized in strategic competence map
(appendix 1) (Bergh, Lefkovitch, Scotti 2009).
GM has merged with Holden since 1931 to form GM Holden – an Australia subsidiary
distributing cars, trucks and auto parts. Today, Holden is seen as a center of expertise in
design, engineering and customer programs for GM globally, responsible for global
concept cars, large and rear-wheel drive vehicles, etc. (Holden 2015).
Holden Commodore is Australia’s best selling passenger car within 13 consecutive years
(General Motors 2015). However, this car version together with Holden business are
facing some challenges, which are clearly analyzed and summarized in appendix 2
including external and internal analysis, competitors and SWOT. In brief, it needs to
establish new venture to improve current situation and increase sale revenues.
2. Recommended new venture proposal
2.1. Venture description statement
New venture idea is Holden and Ford will collaborate with each other as a strategic
alliance to run new car version project named Commodore – Ecosport. This car is the
combination of two well-known brands: Commodore (Large Sedan segment from
Holden) and Ecosport (Medium SUVs (Sport Utility Vehicle) segment from Ford).
There are many reasons leading to this decision. Initially, the SWOT analysis table shows
that Holden is facing a lot of challenges in Australia automotive market: presence and
market share is replaced by Toyota as a market leader together with significant sale loss

5. 3
of commodore cars. Secondly, the pressure from Australia government and greener fuels
force Holden to provide the more appropriate cars shifting from traditional fuels to hybrid
and electric powered ones. Thirdly, small and medium SUVs are the potentially fast
growing market in the future. Finally, Holden has its strengths in management styles,
technology and financial supports from parent company – GM and Australian
Government (appendix 2). From all the reasons above, the launching of Commodore –
Ecosport seems to be the most appropriate solution to Holden status currently. This
solution has ambition to revive key Holden’s brand identity – Commodore cars; improve
its sales revenues; scramble for market share from Toyota as well as catch up the new
trend for greener fuels and favor of small and medium SUVs.
There are two concerns raising from this project: why Holden does not use its technology
to redesign new product matching SUVs and Commodore; why Holden must collaborate
with Ford – the third players in Australia automotive market but not other small
competitors. From Win – Win approach, the answer could be:
From Holden’s perspective, doing this project independently faces many difficulties in
time, capital and risks under Holden’s situation currently. Strategic collaboration with
Ford – a US motor with mutual US culture and working styles can help Holden utilize the
high technology, economy of scales and distribution channels of both firms to co-grow
strongly enough to outperform Toyota and avoid the other small and medium firms have
any chance to jump in the market. As a result, rivalry in the market will be reduced with
only two mainstreams: US auto firms versus Japanese firm.
From Ford’s perspective, it also gets some advantages from this project. Firstly, Ford
only had small shares in sedan segment (8.4%) and was left behind Toyota (17.6%),
Holden (13%), Hyundai (12%) and Mazda (11.9%) (appendix 2), this new project helps
the firm utilize the long-establishing brand name – Commodore from Holden for rapidly
co-gaining market shares. In addition, this is an opportunity for Ford to show its
extraordinary design and power hybrid engine of SUVs for wider ranges of customers.
In brief, the uniqueness and innovation of this project are mainly described in two key
points. Firstly, Holden dares to strategic cooperate with competitor to reduce rivalry in
market. Secondly, this project open new potential market segment: a mixture of sedan
and SUVs, which will be the leading trend in the future.

6. 4
2.2. Marketing
2.2.1. The objective of Commodore – Ecosport project
4 main objectives needed to achieve when launching Commodore – Ecosport, these are:
- Raise 70 % awareness of target customers after initial launching
- Sale volumes reach 40,000 pcs within “official launching” period
- Market share gains 20% and be the market leader in new segment after 5 years
- Improve and strengthen “Commodore brand” – a symbol of Holden
2.2.2. Target market
The target market of Commodore – Ecosport is young and modern family with 1-2
children. Their characteristics are summarized in the table below
Age 28 – 35
Education & Income High and stable
 Be financial independence and still enjoy the couple life
even already married without worrying about costs of living,
responsibilities and children’s education.
Lifestyle Young, proactive with distinct lifestyle and catch up trend
 Love to travel to new places with their small family, explore
new things and challenge their limitations
Demand Looking for appropriate cars to satisfy their love of adventure
 Marriage does not stop their life, it brings more people go
together: “To go faster, go alone but to go further, go together”
Cars’ criteria Fuel saving; durable; convenient, spacious; compact design;
eco-friendly; fashionable design to prove their living styles
The size and influence
of this target customer
in Australia market
Young adult still remains its high proportion in Australian
society (Australian Bureau Statistics 2012) and the average age
of them to get 1st marriage is 25 – 35 (appendix 3)
Couple living with dependent children hold the large
percentage in Australian’s family types (ABS 2006)
 Potential source of consuming Commodore – Ecosport

7. 5
2.2.3. Positioning and core competitive advantage
Commodore – Ecosport is positioned as the fashionable, strong, reliable high
performance car with its core competitive advantage from “Commodore brand”
combined with various designs from Ford’s SUVs and hybrid engines.
2.2.4. Competitors
The main competitor of this segment is Toyota, which was the market leader in both
sedan and SUVs segment (market share gain nearly 20% for each segment – appendix 2).
2.2.5. Marketing Mix
Product: Commodore – Ecosport
Overall, Commodore – Ecosport maintain the core design of “Commodore brand” as the
symbol of Australian use. This new car has 4 chairs including driver but allows more
space to seat and store traveling packages. The length of car is shortened while the height
is increased to create more convenience for environment inside during long travel trips.
Place: Utilize dealerships of both firms to sell new products
Pricing: Penetrating pricing strategy is applied with affordable price for Commodore –
Ecosprort to quickly catch customer attention and gain market shares. Additionally, the
product’s price should reflect the target customers and distinctiveness of product
innovation – a crossbred version of Sedan and SUVs. For instance, the cars’ average
prices of Holden and Ford and suggested prices are as follow
Holden Ford
Sedan $40,000 – $56,000 (Commodore) $40,000 - $48,000 (Falcon)
SUVs $25,000 - $38,000 (Captiva) $25,000 - $30,000 (Ecosport)
 Suggested price of Commodore – Ecosport: $38,000 - $48,000
Promotion: 5 main forms are used including TV advertisement, billboard, magazines,
sale promotion and concept stores.

8. 6
2.3. Operation and Management
The mode of Corporate Venturing used is Cooperative in which Holden and Ford form a
strategic alliance to run a new car project: Commodore – Ecosport, a co-branding of both
firms. According to the agreement, Holden is responsible for car’s parts and interior
design while Ford supports to redesign car’s appearance, structure, and proportion as well
as strengthen hybrid power engine. This division of tasks is based on the specialization of
each firm and final goal of new car version: maintaining the core spirit of “Commodore
brand” while at the same time renewing them with more sporty, compact and fashionable
design. A new manufacturing plant and 40 concept stores are built by the equal
contributions of both firms. A group of new employees should be recruited and trained to
meet the project’s objectives.
The chart below provide simplified view about management structure of this project
Brand directors from Holden and Ford will lead this project under independent evaluation
team and consultation Board. They have their own roles and responsibilities to set the
more approachable goals, timeline, people and resources allocations. At the lower levels,
functional departments are clearly form to specialize their tasks for effectiveness. Sale
team is one of important factors to ensure sale revenues by mainly controlling dealership,
concept store and sale representatives. To attract and maintain the best sale team, Holden
and Ford need to build appropriate incentive policies for their employees. For instance,
valuable bonus and award if they boost the sale revenue significantly; allow employees
have chance to test new product to provide real experience and review for product
improvement and customer’s consultation, etc.

9. 7
2.4. Financials
The below table provides simplified view of cost investment on Commodore – Ecosport.
Overall, both firms must bear the high cost of fixed technology, corporate and R&D
within the first two years due to no sale revenues. 2018 marks the year of initial
launching to test customer reaction. Even though, small numbers of new cars are sold, the
sale revenues cannot compensate high fixed costs together with arising marketing fee to
catch customer attention. This project only brings high profit since the fourth year that
compensating all losses of previous years and promising high portfolio in the future.
2.5. Risk management
The evaluation scale below will be used to measure risks for timely actions
Level Consequence Description
4 Severe Financial loss greater than $50,000
3 High Financial loss between $10,000 and $50,000
2 Moderate Financial loss between $1,000 and $10,000
1 Low Financial loss less than $1,000
If the risks are at low and moderate level, relevant managers only report of brand director
to notify of existing risks and have their own responsibility to solve the problem. If the
risks range at high and severe levels, it needs the involvement of Brand Directors of two
firms to discuss and find the solution. In addition, it also has inevitable risks when
executing this project. Some recommendations are also provided as follow

10. 8
Potential problems Recommendations
Non-appropriate design combining
“Commodore” and “Ecosport”
Conduct more prototypes; rethink of product ideas
and find the core reasons
Lack of customer attention Recheck marketing strategy
Budget runs out Identify where the money goes and ask for financial
support from GM, Ford and Australian Government
Conflict of structure, corporate
culture when working together
Clearly define roles and responsibilities of
individuals; Arrange more informal catch up and
meeting to share and build more understanding
Unqualified sale teams to meet the
project’s requirements
Recruit qualified people outside Holden and Ford to
have fresh mind of new product concept
2.6. Harvest strategy
Overall, this project includes 4 stages from embryonic stage to initial launching, official
launching and strong development (figure 1). To minimize the cost of investment, at the
end of initial launching stage, there are many important decisions should be made.
Firstly, if the project still works well, new manufacture plant and concept stores are built.
Big recruitment of qualified engineers and sale teams are executed quickly to meet big
production and official launching. In case, no positive signal from initial launching, it
needs to end the project immediately to change more focus to other investment.
Figure 1: Stages of develop Commodore – Ecosport
Sources: Self-summarized by the author
In case the project cannot run completely, idea from this project could be reconsidered to
develop in the near future such as matching two other appropriate types of car versions to
penetrate in new segment or cooperate with other small firms to minimize the conflict.
Holden should see this cooperation as a chance to gain more insights about market,
competitors, their capacities and resources for next big breakthrough.

11. 9
2.7. Milestone schedule
11/2015 Present idea to Holden’s B.O.D
12/2015 Final approve from Holden B.O.D and proposal of strategic
alliance to persuade Ford to cooperate
1/2016 Final agreement between Ford & Holden
Start the project “Commodore – Ecosport”
1/2016 – 12/2017 Embryonic stage of “Commodore – Ecosport”
1/2016 – 1/2017 - Time for both firms to understand each other about: new
structure, working styles, manufacture process, technology, etc.
- Work together on new product design, car’s parts, engines, etc.
- Focus on R&D
- Monthly and quarterly catch up
1/2017 – 12/2017 Car prototypes and testing
1/2018 Initial launching
1/2018 – 6/ 2018 - Make the 1st version of Commodore – Ecosport at Holden
manufacture plant
- Initial launching “Commodore – Ecosport”, which is seen as the
special version of Commodore under the campaign “40th
anniversary of Commodore - iconic brand name of Holden
- Test customer reaction, feedback and insight for improvement
6/2018 – 12/2018 - Build manufacture plant and conceptual stores
- Final integrated marketing campaign
1/2019 Official launching “Commodore – Ecosport”
1/2019 – 12/2019 Boost up marketing and sale activities to quickly gain market
shares and increase sale revenues
2020 – 2022 Maintain marketing at moderate level, focus on dealership to
distribute these new cars for wider areas

12. 10
3. Summary
In brief, the new venture idea is cooperating with Ford with the aim of reducing rivalry in
the market place; utilizing the existing strengths of both firms to compete with Toyota;
creating new segment of Sedan and SUVs combination to catch up trend; improving
Holden current status and increasing sale revenues. Not only providing the idea, the paper
also identify the core reasons based on environment analysis and Holden’s core
competencies. Overall considerations of Marketing activities, operation, management,
financial, risk management, harvest strategy and milestone schedule are mentioned for
Holden’s shareholder to see the potentiality of this project. Hopefully, with more strategic
discussions, the final ideas and operations of this new venture are approved to apply in
the reality, which promises to bring Holden into the high level of development.

13. APPENDIX 1
CORE COMPENTENCE MAP OF GM
Sources: Bergh, Lefkovitch, Scotti, Warner 2009

14. APPENDIX 2
1. External environment analysis
1.1. PEST analysis
- Political (The role of Government in assistance of automotive industry in
Australia): Initially, the Australian automotive industry receives direct support of $500
million from the Government annually. However, the level of assistance is also small in
comparison with other countries. In more detail, the figure 1 below states that Australia
had the lowest level assistance per capita among seven nations while Sweden gave the
highest support to its automotive industry (ABC News 2014).
Figure 1: Government budgetary assistance to the automotive industry in 2008 –
2009 ($US per capita)
Sources: ABC News 2014
Secondly, the effect of corporate tax rates created more challenges for companies to
invest in automotive industry. In Australia, the corporate tax rates include federal
corporate tax, payroll taxes levied by the state. Australia’s corporate tax rate is 30%
equivalent to France, Germany and India. UK and China have the lowest rates while
Japan and US have the highest rates (Figure 2 - Allen Consulting Group 2013)
Figure 2: Headline corporate tax rates in selected countries
Sources: Allen Consulting Group 2013

15. Thirdly, Holden, Ford and Toyota are three main players in this industry. To break the
monopoly of these companies and support local manufacturers, the Australia Prime
Minister – Tony Abbott declared that there would be no taxpayer assistance. The
Government had also increased pressure on Holden to clarify its future plans for
Australia (BBC News 2013)
Therefore, unfavorable factors from Australia Government lead to Holden’s decision that
it will stop manufacturing car in Australia by the end of 2017. However, this decision can
cause many negative results threatening the end of automotive industry in Australia. For
instance, 50,000 automotive jobs are lost (BBC News 2013); Ford may follow GM
Holden decision to leave Australia too and allow Toyota as the sole player in the
marketplace. This thing will place unprecedented pressure on local supplier network and
Toyota’s ability to provide enough cars for consumer consumptions (Jonhston 2013).
In order to avoid unexpected results and keep Holden making cars at Elizabeth in
Adelaide until 2022, a co-investment among GM Holden, South Australian and Victorian
Governments has been agreed in which the combined Government funding of $275
million will leverage excess of $1 billion in total investment. Specifically, this investment
allows GM Holden to build two world-class, which is considered as the next generation
new car for a Greener Future in Australia with lower greenhouse gas emissions per
kilometer driven. It also ensures GM Holden continues domestic car-making until at least
2022 and allow GM Holden to change its purchasing strategy to provide more long-term
certainty to local auto component manufacturers with the enhancement of design and
engineering services for global platform uses (Allen Consulting Group 2013).
- Economy: strong Australia currency that has risen nearly 30% against the US dollar
and weak Japanese Yen over the past five years has created many challenges to Australia
automotive industry in general and especially Holden (BBC News). Firstly, the
production cost is higher in comparison with other technology-intensive countries (Japan,
US, etc.). Wide ranges of data conclude that nearly 85% of car sold in Australia are
imported. Secondly, the local content in car production is reduced and replaced by other
cheaper parts from wide ranges of areas. These thing places the industry under more
severely competitive market both from cheaper imports and its effect on export
competitiveness (The Allen Consulting 2013).

16. - Social: A study of census data found that nearly 2/3 Australians drive to work in a
private car while only 1/10 commuters reply on public transport (figure 3). This thing
shows the huge potential market of private consumption in Australia (Mc Crindle
Research, Social Analysis 2014)
Figure 3: Top 5 ways Australians get to work
In addition, the recent trend in customer habit is Australians are saving more but are more
comfortable with debt. They seem to use more complex financial products for their
consumption with the purpose of more savings (The Conversation 2015). Besides that,
old cars are more preferable because of its commercial benefits than the new cars. In
detail, the VFACTS reports states that new vehicle in 2014 decreased all Australia’s
states (ACA research 2015)
Finally, Australians prefer small passenger cars, which hold the leading segment in the
market place (260,820 units were sold in 2014). Additionally, people seems to change
their tastes to small, medium and large SUV car versions which all sales numbers all
recorded increases. In detail, small SUV sales increase 16.5%, while 4.8% boost of
medium SUV (figure 4 - ACA research 2015). It can be concluded that small and
medium SUV will be the potential market to jump in for future usages.

17. - Technology: Australia industry is high-technology practices with full of talent
designers and engineers. This technology-intensive status is a result of the global projects
of multinational companies that produce advanced equipment and technology for their
global uses of manufacturing process. In addition, Australia also provides loans to
automotive R&D on the trend of greener technology of car manufacturers (Allen
Consulting Group 2013). For example, the eV engineering project between leading
Australian automotive suppliers has converted a fleet of locally manufactured Holden
commodore passenger car to proof-of-concept fully electric vehicles. Technologies used
in this project are considerable for mass production in the future (Australian Trade
Commission 2013). However, the greener technology can cause some unexpected effects
to Australia economy because coal is main source of domestic energy (85%) and the most
lucrative commodity that brings $22 billions earning to Australia annually. Old coal
which cannot be preferred to new form of clean and effective energy sources like hydro,
solar, wind, wave, nuclear, etc. causes loss in Australia GDP (Ben Mc Neil 2009).
1.2. Five-forces analysis
- Bargaining power of suppliers
Automotive is the combination of wide ranges of components including body panels,
bumpers, doors, windows, brakes and braking systems, etc. This creates a potential
market for many suppliers to specialize in some distinct systems and devices. Therefore,
there are many suppliers in industry, which does not allow them to put high pressure on
automotive manufacturers. In other word, the bargaining power of suppliers is very low;
manufacturers can easily switch to another suppliers if necessary (Highfill, Baki 2004)
- Bargaining power of buyers
The bargaining power of buyers is moderately high because firstly, the buyers consume
almost of industries output. Secondly, the buyers have low switching cost in which they
are easy to change to competitors’ products if they found more convenience and benefits.
It means they shortly use of current cars and purchase the new ones if necessary.
However, the power of buyers cannot reach completely high level because the buyers are
limited in few numbers and separately. They do not have the ability to integrate
backwards into the industry and only purchase the car from a dealership (Highfill 2004)

18. - Potential entrance
Even though automotive is potential and wide market, it is not all easy for new entrances
to jump in because of many barriers. To begin with, this industry is very mature and has
strict requirements in high technologies, specialization and capabilities for accuracy and
economy of scale. Additionally, labor cost in Australia is relatively high compared to
competitors in Asia and US (Allen Consulting Group 2013). Next, incredible amount of
capital is a strong barrier limiting new entrances. In order to survive and compete well
with other long-established firms, they must have stable financial sources to release new
quality products and catch up trend. Finally, distribution channel is considerable as a high
barrier to entry. Dealership is the only channel to reach buyers so it is essential to take
advantage of influenced and trust-worthy dealership. The new entrances will face some
challenges in launching their own dealership, which can be limited in space for variety of
inventory. In brief, the threat of new entrances is very low (Highfill, Baki 2004).
- Product substitutes
Pressure of product substitutes is moderate. There are wide ranges of substitutes to meet
customers’ needs and their budget such as walking, cycling or public transport. However,
these kinds of transportation depend on geographic, weather, timetable, etc. which
prevent the active consumers to go to their wanted places. Owning a car allow more
flexibility and convenience rather than travel by public transport or affordability when
traveling rather than taking plane. It can be indicated that car is the most preferable form
of transportation in comparison with others (Highfill, Baki 2004)
- Competitive rivalry within an industry
Rivalry among competitors is very strong within automotive industry. The first reason is,
there are only 3 main competitors: Holden, Ford and Toyota in Australian automotive
industry. To gain more shares within closely balanced market, each firm must hardly
acquire customers from competitors. Secondly, the speedy development of internet and
social network allow customers more convenience to compare products’ aspects among
competitors and choose the most appropriate one. As a result, it creates more pressure to
the firm to have unique technology to outperform its competitors (Highfill, 2004)

19. 2. Internal environment analysis
In general, Holden is commonly known as a strong regional player in Australia and New
Zealand market and specializes in SUV, Commodore and Minivans cars. It has the strong
financial capacity under General Motors – its parent’s company to invest in wide ranges
of car versions and high automotive technologies (MBA school.com 2013). Holden and
General Motors globally view Australia as concentrated design center with ambition to
penetrate in Asian market. Today, Holden has maintained its market leader in Australia
thanks to the driver of strong leadership and collaboration innovations. At Holden,
overall capabilities of Board members and their relationship are often checked and
improved to meet business strategy. They are focused and inspiring team leadership to
motivate employees to higher standard of performance. They also promote team spirit
and take advantage of group work than individual work, which allow whole organization
move forward (Hay group 2013).
However, the distinct characteristic of automotive environment with highly structured
and specialized manufacturing together with ensuring sustainable development and
enhancing global competitiveness have create the key issues for Holden. These are
Holden needs to provide flexible working arrangements for their employee, attract the
best people and maintain the core knowledge to survive in severely competitive market
nowadays. Holden has experienced a shortage of both graduate and experienced electrical
engineers who are easy attracted by Information technology careers. Therefore, it has
changed strategy to more focus on people by provide employees with continuing
opportunities for development and satisfaction in their career. In Holden’s view,
education has the vital role for future economic development. In addition, Holden also
increases the diversity within workforces for business innovation and outcome
improvement by increasing the number of women employees. It also focuses on creating
suitable and safe working environment and providing family support to ensure employees
have free mind to work well (Holden 2004)
3. Competitor analysis
The core competencies of Holden are research capabilities, high technologies, worldwide
operation and strong financial support from General Motors. The STP strategy of Holden
is summarized in the table and chart below

20. Table 1: Holden’s STP strategy
Sources: MBA school.com
Figure 4: Holden’s positioning
Sources: Zhang Di 2013
Holden aims to create the brand of affordable price with high quality. It sets low initial
price lower than market price to attract new customers. This strategy allows Holden to
gain market share quickly and create goodwill and words of mouth. It also discourages
other competitors to enter in the market and creates high stock turnover.
However, recently, Holden faces a lot of challenges when competing with 2 big players –
Ford and Toyota in Australia automotive industry. These figures below reveal some
unexpected facts of Holden about market share, profits and productions as well as market
shares in passenger and SUV segments.

21. Table 2: Total market share within Australia automotive industry 1998 – 2012
Sources: VFACTS Retail Sales
There are three big players in Australia automotive industry: Toyota, Holden and Ford.
Table 2 shows two major trends: from 1998 – 2002, Holden was the market leader; while
from 2002 – 2012, Toyota has replaced this position. The market share of Ford seems
gradually decrease years by years.
Figure 5: Car making Australia by numbers
Sources: Mark Hawthorne 2013
2013 seems to be the hard year of Holden with the loss of profit highest in comparison
with its competitors (- $152.8 m). This thing leads to the decision to stop manufacturing
in Australia by the end of 2017. However, the Australian Government has signed the co-
investment with Holden to support this firm and prevent negative effect if this firm leaves
Australian automotive market (Mark Hawthorne 2013).

22. Table 3: Productions (Units) of locally made PMVs, PMV Derivatives and SUVs
Commodore is considered as the brand identity of passenger cars of Holden, in other
word “Say Holden, say Commodore”. However, within 8 years (since the peak in 2004
to 2012), total sales of Commodore were decreased significantly, nearly two-third both in
domestic and export markets. 2006 – 2008 was the “golden period” of Toyota Camry; the
productions reach the peak for domestic consumption and expand to export markets
(Simon Thomsen 2013)
Figure 6: The market shares in Passengers and SUV segments
PassengerSegment SUV segment
Sources: Automotive Industry Research 2012
It can be indicated that the automotive market leader now is replaced by Toyota by
holding the biggest shares in both Passengers and SUV segment (nearly 20%) while

23. Holden is located at second position. These above figures and tables warn the severely
competitive status within Australia automotive market that needs to have more
appropriate and timely action from Holden to maintain its position.
4. SWOT
Strengths
- Strong leadership and collaboration
innovation
- Good and qualified Board of Director
- Effective teamwork
- Good HR strategy, focus on people
- Good positioning strategy with the
affordable price for high quality  gain
big market share
- Commodore cars is the brand identity of
Holden
Weaknesses
- Market limitation in New Zealand and
Australia
- Global presence and market share is
negligible compared to other automotive
manufacturer (Toyota replaces the market
leader in Australia market)
- Sale loss of commodore cars  need to
have more innovation to catch up trend
Opportunities
- Government supports for maintaining
manufacture process in Australia and
innovating new car generation for Greener
Future
- Small, medium and large SUV are the
potential segments in the future
- High innovation allows efficiency and
innovation
- Low pressures from suppliers, buyers,
potential entrance and product substitutes
- Expand to Asia countries by taking their
advantage of low production and labor cost
Threats
- Small government budget assistance
- High corporate tax rate
- Strong AUD currency, high production
cost  more competition from cheaper
imports and export competitiveness
- People seems to savings than spending 
old cars is more preferable
- Increasing shift from traditional fuels to
hybrid and electric powered cars
- High competitive rivalry

24. APPENDIX 3
TRENDS IN YOUNG ADULTS PROPORTION, MARRIAGE AGE AND
FAMILY TYPES WITHIN AUSTRALIA SOCIETY
Chart 1: Young adults (18 – 24 years old) as a proportion of the population
Source: ABS Australian Demographic Statistic 2012
Chart 2: Family types, 1976 – 2006
Sources: Australian Institute of Family Studies 2011
Chart 3: Marriage Age
Sources: ABS (1981); Commonwealth Bureau of Census and Statistics (1965); Lancaster,
Huang & Pedisich (1994); Laws & Sullivan (2009)

25. REFERENCELIST
ABC News 2014, Bill shorten's subsidy number irrelevant, outdated, Fact check, viewed
07/10/2015, < http://www.abc.net.au/news/2014-02-11/bill-shorten-car-subsidy-numbers-
irrelevant-outdated/5251536>
ACA research 2015, Vehicle sales - Trend in the Australian Automotive market, ACA
research, viewed 10/10/2015, < http://www.acaresearch.com.au/australian-market-
research-blog/bid/360234/2014-Vehicle-Sales-Trends-In-The-Australian-Automotive-
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