Holden, General Motors’ Australian arm, has taken the unusual step of halting production at its sole vehicle assembly facility – to correct quality problems, writes Mike Duffy.

The nine-hour stoppage at the Adelaide, South Australia plant, cost the car maker 304 Commodore and Statesman models, with a total value of over $A1 million ($US543,000).

The vehicles were destined for domestic and overseas markets.

The car company’s management decided to cease production at 2pm on Wednesday.

Workers made idle by the move did not lose any pay by the nine hour stoppage.

Instead, they worked with production area managers to discuss how to improve build quality.

Production at Elizabeth began again on Thursday morning after quality issues had been addressed.

A marked improvement in quality has been achieved by the stoppage, the company reports.

The stoppage was ordered by the executive director of manufacturing operations Albert Lidauer.

A Holden spokesman said a quality assurance audit – part of the car maker’s on-going production practice – identified a number of items which fell short of the company’s strict production standards.

Poor fitment of a range of components including handbrakes, air-conditioning units, and door and boot seals were among prime areas of concern.

Component manufacturers are understood to have been called in and read the riot act.

The company is known to have told leading suppliers to either lift quality or risk losing lucrative contracts.

Holden’s public affairs director John Morrison said: “The management took a decision to halt production to discuss quality issues with assembly line area managers.

“Stopping the production lines was a bold thing to do, but it reflects a change of culture that we are not going to hide poor quality – we are going to bring problems into the open and get them fixed.”

Mr Morrison said none of the faults related to vehicle safety.

“We are competing with some pretty hot brands in Australia and overseas and we have got to maintain build quality at the highest level.

“Most of the faults were likely to have gone unnoticed by customers, but we set high quality standards and are determined to meet them.”

The company has had significant success exporting cars, particularly to the Middle East, mainly because of the high quality and consistency of its vehicles.

Holden increased daily production to 547 vehicles late last year from 530 and is planning to grow production to 604 cars per day later this year.

John Camillo, state secretary of the Australian Manufacturing Workers Union said: “We don’t have any problem with the manner in which Holden halted production and the reasons for the stoppage.

“Our workers are as keen as Holden to turn out world-best cars. We understand that perfect cars sell and increased sales mean job security.

“We are at one with the management on this one. We have to build perfect cars if we want to maintain our position as a global car maker.”

Australia’s No 1 automaker produced a record 133,000 vehicles in calendar year 2000 and plans to boost production to 200,000 units a year by 2004 with half earmarked for export markets, mainly the Middle East.

Holden’s vehicle export programme received a boost late last year with the first shipment of Commodores to South Africa.

Holden exported a larger than forecast total of almost 29,000 vehicles to markets in the Middle East, Brazil, New Zealand, Japan and South Africa, earning $1 billion in export revenue.

Author Mike Duffy is motoring editor of The Advertiser and Sunday Mail in Adelaide, South Australia.