North American International Auto Show in Detroit.FEDERAL...

North American International Auto Show in Detroit.

FEDERAL Manufacturing Minister Kim Carr has denied a multimillion-dollar taxpayer payment to keep automaker Holden operating in Elizabeth is a "bailout" or "handout".

Touring the Adelaide site of component maker Futuris with Premier Jay Weatherill today, Senator Carr said the sector received less taxpayer subsidy than mining and agriculture.

"We do not, under any circumstances, provide handouts to companies or bailouts to companies," he said.

"We are in the business of supporting companies that invest in themselves."

The Opposition is calling for the State Government to undertake a cost-benefit analysis of spending on Holden to determine if further taxpayer funds may be better spent elsewhere.

The Government is refusing to reveal how much is is considering giving Holden.

Leading economist John Spoehr has forecast it will likely be in the ballpark of $200 million.


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Holden is guaranteed to remain at Elizabeth until 2016, when the Cruze model ends its run.

An announcement on a deal is expected within weeks and the Federal Government will give the bulk of the cash.

Mr Weatherill today said closure of Holden would blunt attempts to build an advanced manufacturing sector.

"Once you've lost manufacturing, you can't rebuild an advanced manufacturing sector," he said.

"This is about making sure the doors of Holden and the doors of Futuris are kept open.

"The nature of the conditions that we're seeking to apply to our investment includes support for component manufacturers.

"Our objective here is to not only secure the jobs of those (Holden) workers at Elizabeth, but also the jobs of those workers that exist within the global supply chain for car manufacturing.

"That has been a central part of our discussions with Holden."

Senator Carr said the high Australian dollar was harming exports of locally built cars.

He forecast the value of the dollar would decline over time, improving business conditions.

"We are working with companies on the basis of their spending far, far much more money than the Government would ever put into any assistance arrangements," Senator Carr said today.

"This is about building the capabilities of the industry and ensuring that people have the wherewithal to take advantage of prosperity.

"Circumstances at the moment are having very serious consequences for Australian manufacturers who export or who are facing competition from imports.

"We are in the business of making sure we have high-end technology capabilities for the future. That requires investment, that requires lots of money to be spent by the companies to secure that investment."