Holden's $33 million blow to BlueScope

BlueScope Steel will lose at least $33 million in revenue a year when Holden shuts down local car manufacturing in 2017.

BlueScope Steel supplies 14,000 tonnes of steel worth about $18 million directly to Holden to make vehicles in Australia each year.

Major Holden suppliers buy more than $15 million of steel from BlueScope.

South Coast Labour Council secretary Arthur Rorris said yesterday it was "obvious" other manufacturers along the supply chain would be impacted when Holden closed.

Mr Rorris called for an urgent rethink on how Australia entered into trade agreements with other countries.

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"We need to decide whether we still ... want to maintain any manufacturing sector whatsoever."

He said successive federal governments had been selling Australian workers short by allowing other nations' manufacturers to gain a competitive advantage over local businesses through free trade deals.

"I think workers of this country are entitled to say we need a fairer trade system not a so-called free trade system," Mr Rorris said.

The University of Wollongong's Manufacturing Innovation - Global Challenges Program director Professor Geoff Spinks said Holden's closure would affect a long list of companies involved in the company's supply chain.

"Car companies are at the top of the long supply chain so that's the real problem," he said.

"It creates this trickle-down effect where all suppliers suffer because that market evaporates."

BlueScope reported a loss of $84 million in 2012-13, an improvement on the $1 billion loss in the previous financial year.

BlueScope yesterday declined to elaborate on the specifics of its exposure to the automotive sector.

"We're not going to be commenting on our customers publicly," a BlueScope spokesman said.

However, the spokesman pointed to BlueScope's annual revenue of around $7.3 billion globally, and broad portfolio of markets, products and customers as evidence the company was not overly exposed to any particular customer.

The value of Holden's business to BlueScope was buried inside a Holden submission to the Productivity Commission inquiry into car assistance.

The document revealed that it spent $18 million in 2012 on Australian steel from BlueScope, or "approximately 14,000 tonnes".

"Holden forecasts to purchase the same amount, or more, by end of 2013," the document said.

Holden revealed that some of its main component suppliers, including Precision, AIA and Carr, purchase 90 per cent, or $15 million worth, of their steel from BlueScope.

Holden disclosed the steel was transported by rail from BlueScope's steelworks at Port Kembla, and that a "significant proportion" of the car maker's steel requirements came from BlueScope.

BlueScope said the automotive and transport industries represented 8 per cent of total domestic steel volumes in 2012-13.

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