General Motors is exiting Australia, New Zealand and Thailand to save costs in the underperforming markets and better hone its focus on growth markets as well as on its electric vehicle and self-driving car strategies.
As a result, GM said it expects to incur net cash charges of $300 million and to record total cash and noncash charges of $1.1 billion. These charges will primarily be incurred in the first quarter and continuing through the fourth quarter.
But the move will not affect GM's U.S. operations, a GM spokesman said. GM's Spring Hill Assembly plant in Tennessee builds the Holden Acadia SUV for Australia, but the volume is so small that it will not affect Spring Hill's production or employment, the spokesman said. The plant will make up the volume with its other products: the GMC Acadia and the Cadillac XT5 and XT6 SUVs.
"I've often said that we will do the right thing, even when it's hard, and this is one of those times," said GM CEO Mary Barra in a news release Sunday night. "We are restructuring our international operations, focusing on markets where we have the right strategies to drive robust returns, and prioritizing global investments that will drive growth in the future of mobility, especially in the areas of EVs and AVs."
GM employs 828 employees in Australia and New Zealand and 1,500 in Thailand, a GM spokesman said.
Barra said that the actions support GM's global strategy, which it laid out in 2015, but, "We understand that they impact people who have contributed so much to our company. We will support our people, our customers and our partners, to ensure an orderly and respectful transition in the impacted markets."
GM said it will wind down sales, design and engineering operations in Australia and New Zealand and retire the Holden brand by 2021. It will focus its strategies for the market on the GM specialty vehicle business.
GM Holden's market share peaked in 2001 at 21.4%, but it's seen a steady decline since 2003, bottoming out at just 4.1% in 2019.
The automaker also said it had signed a binding term sheet with Great Wall Motors to purchase GM's Rayong vehicle manufacturing facility in Thailand.
GM will withdraw Chevrolet from the domestic market in Thailand by the end of this year.