HOLDEN has won a longstanding case fought against it by a group of its dealers who claimed that the now defunct car-maker had allegedly breached their dealer agreements when parent General Motors pulled the Holden brand from Australia in 2020.

In handing judgement to Holden, the Supreme Court of Victoria today found that GM did not breach its agreement with Holden dealers by failing to supply them with vehicles.

In its response to GoAutoNews Premium, a GM Australia & New Zealand spokesman said only that: “We welcome the decision.”The decision triggered a retort from the Australian Automotive Dealer Association (AADA) who said it set a “dangerous precedent”. 

Australian Automotive Dealer Association CEO James Voortman said: “Today will come as a massive blow to those dealers who have gone through the exhausting and emotional process of taking on a giant multinational car company.

The legal argument successfully put forward by GM that they had no obligation under the dealer agreement to supply cars to their retailers is incredibly disappointing and sets a dangerous precedent for the automotive industry.”– James Voortman

The court action by Holden dealers sought compensation from Holden for alleged breach of contract when GM retired the Holden brand and Holden was unable to supply dealers with cars to sell to the public. 

The dealers are alleging that Holden was obliged under their dealer agreements to supply the dealers with Holden vehicles for five years from 2018. 

By ceasing to supply Holden vehicles just two years into the five-year agreement, the dealers are claiming compensation for allegedly breaching the terms of the Holden supply contract.

James Voortman

The AADA said that the case was brought forward by a group of dealers who did not accept GM’s compensation offer at the time it ceased the Holden brand in Australia. The AADA said that the dealers “are now considering their options.”

Mr Voortman said that the dealers involved in the claim “upheld their end of the bargain.”

“They invested in facilities, employed staff and dedicated their talents to selling Holden vehicles in the communities in which they operate because they were led to believe that the Holden brand was set to stay in Australia for the long haul,” he said.

This highlights the importance of the franchising protections announced by the Government earlier this week and it is critical that we achieve bi-partisan support and enact these measures as soon as possible. – James Voortman

“There also needs to be a conversation about how franchisees access justice. Large companies are only too happy to go through a court process which is costly and can take years to get an outcome.”