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ACCC urged to investigate Holden conduct

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The Australian Competition and Consumer Commission has been urged to press on with its investigation into Holden’s conduct in the lead-up to the closure of the car brand in Australia, following the findings of a Senate committee report tabled on Thursday.

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The committee found there was a clear imbalance in the bargaining power between Holden and its dealer network in termination and compensation negotiations.

“The committee was made aware of dealer concerns, both publicly and confidentially, in relation to Holden’s failure to engage in genuine negotiation,” the Education and Employment References Committee said.

It said dealers felt pressured into accepting a compensation offer, and it remained concerned by allegations Holden might have breached the good faith obligations of the Franchising Code and unconscionable conduct provisions in consumer law.

During the inquiry, the committee was told by the ACCC that it was following up allegations made by dealers against the company.

In its report, the committee said it was of little comfort to those dealers that the investigation had not progressed.

“Accordingly, the committee considers that the ACCC should expedite its investigation into concerns raised by former Holden dealers and provide regular public updates on this investigation,” it said.

The committee said it was confident Holden would meet its obligations to provide parts and service support for the mandated 10 years, but urged the ACCC to undertake increased oversight to ensure that was the case.

US parent company General Motors announced it was closing the Holden brand early in 2020 and completed the withdrawal from the domestic market by the end of the year.

Its decision followed a period of declining sales and increased market competition and came about three years after it shut down its vehicle assembly operations at the Elizabeth manufacturing plant in Adelaide’s northern suburbs.

The closure prompted strong criticism from both sides of politics, with the major parties pointing to the more than $2 billion in government incentives the company had received for more than a decade before it stopped local manufacturing.

Dealers were also unhappy with how abrupt the decision was made and at the level of compensation offered, especially for those who had recently invested heavily to upgrade their operations.

-with AAP

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