The federal government is refusing to spend any more money propping up the nation's ailing car industry, amid reports General Motors plans to close its Holden operations in 2016.
(Transcript from World News Australia Radio)
As many as 50,000 jobs could go across the country if the nation's car industry collapses.
But Prime Minister Tony Abbott says businesses have to operate profitably without government assistance.
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Mr Abbott says he wants Holden to stay operating in Australia.
But he told Fairfax radio, he's not going to "chase them down the road waving a blank cheque."
"Businesses have to operate profitably and in the end they have to operate profitably because of their own decisions and from their own resources. They can't expect government to do anything other than create the conditions - the proper market conditions, the best possible market conditions for them to operate."
Mr Abbott says there will be no increase on the Coalition's election pledge to provide $500-million in car industry assistance for 2016/17.
He says that's more than enough and the best thing the government can do for the company is bring down taxes, reduce regulation and restore business confidence.
Australian Manufacturing Workers Union state secretary John Camillo says workers are extremely worried if the government doesn't act their jobs will go.
"It is very hard because I see these people on a daily basis and it is an emotional rollercoaster for these people. I know the other day we went to the Productivity Commission Inquiry, a couple of our members broke down because they are concerned about their families, their livelihoods, their future and so on."
Speculation over Holden's closure comes after senior government ministers reportedly revealed Holden was due to announce this week that it would cease its operations in 2016 - when Ford Australia is also due to stop making cars.
The reports are being denied by Holden and Industry Minister Ian Macfarlane.
Senior South Australian Liberal MP Christopher Pyne says ultimately, whether or not Holden remains operating in Australia is a commercial decision for its parent company General Motors in Detroit.
Senior analyst at the Center for Automotive Research in Michigan, Bernard Swiecki told the ABC, he agrees.
"We have a General Motors right now that is to a much higher degree driven by shareholder return, so I don't think there's a whole lot of room for, you know, this sort of nostalgia in the decision making."
But Opposition industry spokesman Kim Carr insists that's wrong.
He says everywhere in the world, where there is an automotive industry, there is a partnership between government and the industry.
Senator Carr says the PM must intervene, not just for the sake of Holden, but for the 50,000 workers employed directly or indirectly in the nation's car industry.
"It's the whole other industries, the whole other series of companies that flow from the decision that General Motors makes. This is an ecosystem. If one goes, it's only a matter of time before the whole lot goes. Now, this industry is at the core of our manufacturing sector in this country."
Mr Carr says the government has been incredibly lazy and indolent, and Industry Minister Ian Macfarlane should be in Detroit speaking directly to General Motors about the company's future in Australia.
Meanwhile, the Prime Minister is also ruling out financial assistance for Qantas.
"If we subsidise Qantas, why not subsidise everyone? And if we subsidise everyone that's just a bottomless pit into which we will descend. And if we offer a guarantee to Qantas, why not offer a guarantee to everyone?
Ratings agency Standard and Poors has lowered the airline's credit rating to BB+, which is considered below investment grade.
While ratings agency, Moody's, says it's considering downgrading Qantas' rating to junk status.
The airline this week announced it will cut one thousand jobs and has flagged an underlying half year loss of up to $300-million.
