MELBOURNE
Ask Peter Hanenberger if he likes being a big fish in a small pond.
The chairman and managing director of Holden wastes no time pointing out that Australia is not a small pond - at least, not if you take into account its rising strategic importance in Asia. 'Export is of major importance to us, to survive into the future,' he says.
A new engine plant, due to open in 2003, should double Melbourne's export of motors to 400,000 units and will supply a new V-6 engine to General Motors in the United States. 'We know we want to export to Europe, that's for sure. Export to the United States could be only for a certain time, but we hope ultimately to export also to Japan, for Isuzu to use.'
Daewoo could be another customer if it emerges from bankruptcy. 'Ultimately we want to approach Daewoo, too, and see if they might have an interest in our engine.'
Hanenberger is on his second tour of Australia. As a young and talented engineer and self-confessed petrol-head (one wall of his office is entirely lined with model Ferraris), he learned a lot on his first visit. In fact, he once was known as Peter Handlingberger for his role in developing Holden's RTS independent rear suspension. He used it to help transform GM's then-moribund image in Australia.
Palace revolt
In 1982, Hanenberger rejoined Opel in Germany. He rose in Russelsheim, eventually to head the international engineering division. At that point, things went bad. In the 1990s, Lou Hughes, GM's president of international operations, decided to use Opel engineers to design vehicles for emerging markets in Asia, South America and other areas. The added duties put extraordinary stress on Opel's engineering staff. Hughes found himself battling with Opel Chairman David Herman, who wanted to devote more resources to product development in Opel's home market in Europe.
Following a near-rebellion within Opel, GM Chairman Jack Smith mounted a corporate shake-up. He recalled Hughes to Detroit and transferred Herman to Russia. Then he put Hanenberger in charge of Opel - starting yet another in-house rebellion. Opel loyalists believed Hanenberger had failed to protect his engineering staff. Smith gave in, dispatching Hanenberger to Australia.
Hanenberger's face lights up when he recalls June 1, 1999, the day he returned to Melbourne to run Holden. He is keen on Australia, but was he glad to get out of Opel? 'Absolutely,' he said. 'There was some nasty politics there. Anger goes away, but I hope to stay here a long time.'
Anger? Now comes a frown, although he continues in the same even tone. 'I was very angry. Absolutely. You know, when you have worked for such a long time in a company like I have, and I have given everything for this company... . When I left, I was working a 17- to 18-hour day. The things we did... . You see all the products coming now - the Astras, the Zafiras, the Vectras, the Speedsters and so on. They were developed while I was there.
'Suddenly, all the load was put on me, I was more or less responsible for everything, forgetting that there was a manufacturing director and a personnel director and so on. I found this very unfair.
'I had a high profile, true, and I still have. I was the oldest guy in there in terms of time served. I was pretty high in the hierarchy. I still am. I always say what I think, and a lot of people don't like this. A particular point was when it got to my family.
'One time, my son was interviewed in the Detroit press about being the son of so-and-so, and so on. That hurts. It hurts terribly when you have kids, and that's when I said, `I don't want to do this anymore.' But that's all over now. Am I still happy with Opel? Yes. Do I want to be there now? No.'
The Holden Lion
Holden must never slip back into the doldrums that it experienced a decade ago, says Hanenberger with some feeling. At the time, the company was close to collapse, with outdated models and poor marketing. The company was turned around just in time, says public affairs director John Morrison.
'That's one of the things which keeps the spirit of the company,' he said. 'People look back at that era and say, `We must never let that happen again.' '
Visitors to headquarters now encounter the original statue of the Holden lion, which Hanenberger rescued from a storeroom.
On his return, Hanenberger took charge of the Melbourne technical development center, which had been set up to serve Asia-Pacific markets. Among other things, this center re-engineered the Corsa for its launch in China and the Barina for its introduction in India. The center also developed the Thailand-built versions of Zafira and most recently the YGM1 joint venture with Suzuki.
For the Australian market, Hanenberger plans to exploit the flexible V-car platform. This platform provides the mechanicals for the Commodore and other Holden products unique to Australia. The platform can be varied in length and width, which is crucial to its success, says Hanenberger. It allows GM to develop models for niche markets.
'Even in small production volumes, Holden can be very, very profitable because of this unique platform we are using. This is the secret of why we can survive here.'
But he stops short of advocating the removal of Australia's import tariffs. Holden imports some models, including the Astra. There is a 15 percent penalty on most imports, and a 5 percent duty on four-wheel-drive vehicles. Hanenberger favors a 10 percent tariff, rather than the elimination of import duties.
Free Trade
Hanenberger is frustrated about slow progress by the Association of Southeast Asian Nations to set up a free-trade zone. 'I think it is ludicrous that Thailand can ship 10,000 pickups here, but we cannot get our cars in there because of an 80 to 100 percent duty. It's even worse with others. The worst is Malaysia.'
If a regional free-trade zone proves impossible, General Motors will push for bilateral trade agreements between nations, Hanenberger said. That might allow GM to win an export quota that would allow it to ship vehicles to a nation such as Thailand.
'If we don't have the ability to sell our goods into the nearby markets, Australia is too small to create an economy by itself.'
Australia, with its climate, open spaces and abundance of car enthusiasts, suits Hanenberger. 'I'm very confident, very positive,' he said. 'I have no plans to go anywhere else. You have to watch how big you want to become, how vulnerable you become. It's better to stop rather than become too big and fall flat on your... .'
Happy at his post, Hanenberger says it would take a lot to lure him from Melbourne. What if GM CEO Rick Wagoner called to say he was needed in Detroit, or to sort out Opel?
'I would have to think about this, to be honest. I would not automatically jump. I tell you, I like it here.'
E-mail writer John Boley at [email protected]
