Victorian state premier Steve Bracks believes special arrangements put in place at Holden's new engine plant will virtually eliminate industrial action that could hit exports, the ABC reports. The plant, which will employ about 600 people, is expected to generate exports worth $A450 million ($US243 million) a year.

Mr Bracks says high levels of consultation, multi-skilling and the most modern equipment should create a happy workforce.

"We have signed and agreed on industrial agreements both for the construction and also for the operation of the plant," he said.

"Their delivery and their export is so critical in keeping their reputation internationally, and [in] Saudi Arabia and other countries it's important to have continuity of supply."