Struggling carmaker GM Holden has announced it will shut down its operations in Australia in 2017.
(Transcript from World News Australia Radio)
It says from 2018, Holden will become a full importer of vehicles.
The announcement is a major blow to the nation's car manufacturing industry.
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Acting Prime Minister Warren Truss told federal parliament the company had informed him of the decision, made in the United States city of Detroit.
"We regret the fact that GM is to phase down its operations in this country. Holden has been an iconic national brand for Australians, a part of our heritage. It's meant a great deal to Australians over generations. Many of us have had the pleasure of travelling and owning Australian built Holdens and it is a pity that will not continue into the future."
In a statement, General Motors, Holden's parent company has confirmed the end of manufacturing and the transition of Holden to a sales company.
GM has blamed the blamed the high dollar, production costs and a small market for it's decision.
It says almost three thousand positions would be cut in the next four years across South Australia and Victoria.
GM Australian chairman Mike Devereux says the sale and service of Holden vehicles in Australia will not be affected.
"Just like they always have been, within Australia and in New Zealand, but from 2018, we will become a full importer of vehicles just like our competition."
Mr Devereux says it wasn't an easy decision to make.
"And the bottom line for General motors is that building cars, as painful as it is to say, building cars in this country is just not sustainable. Now we'll be doing our best to support our people as they make the transition literally over the next 3 to 4 years."
Holden's decision throws the future of Australia's auto industry into doubt.
Ford Australia is due to stop making cars in 2016, and there are concerns that Toyota will pull out as well.
Mitsubishi closed its Australian factories in 2008.
The Australian Manufacturing Workers' Union's national secretary of the vehicle division, Dave Smith says it's almost certain now that Toyota will close shop as well.
"And this will spell the end of 50,000 automotive workers and there's no dispute about that. 50,000 workers will be losing their job because of this decision by General Motors today. I believe that the behaviour has been prompted by the behaviour of the government yesterday. The government's had General Motors' business plans for a very long period of time. They'd shared them with the government, they'd share them with the former Industry minister Kim Carr. The government knew what was required to keep Holden in Australia and to keep the automotive industry in Australia."
The car component industry is expected to be hard hit by Holden's decision.
Richard Reilly is the chief executive of the Federation of Automotive Parts Manufacturers.
Mr Reilly has told the ABC, the news is devastating, especially for around 33,000 workers his union represents.
"Those guys are the guys that make components themselves for Ford, Holden and Toyota so, looks like the perfect storm has come about and that's really devastating news."
Last week, Prime Minister Tony Abbott rejected spending more public money to keep Holden operating in Australia.
Mr Abbott said the government would not offer anything beyond what was promised at the September election - a total of $500-million in car industry assistance to 2016/17.
The company on Tuesday told a Productivity Commission inquiry into the auto industry, it had not decided whether to continue manufacturing cars in Australia.
Treasurer Joe Hockey has defended the government's decision.
"We are going to everything we can for the workers, not just at General Motors Holden, but also to the workers at Toyota, to all of the component manufacturers workers and also to the taxpayers of Australia, because ultimately what it comes down to is prosperity only comes from hard work and enteprise. It doesn't come from the benevolence of taxpayers."
