# Monaro: The Real Story



## 05GTO (Oct 6, 2004)

*MONARO: THE REAL STORY*

By Joe Kenwright, 27, July 2005









Australian performance car fans were rocked by this week's announcement that Monaro production will finish at the end of the year. Joe Kenwright finds that under every dark cloud there could be a polished alloy lining.

This week's announcement that the Australian market Monaro will finish at the end of 2005 comes as no surprise to industry watchers. What Holden was not saying is of far greater interest to fans of this Holden icon.

In an exclusive interview with CarPoint, Holden's dynamic Executive Director of Sales and Marketing, Ross McKenzie recapped the promise he made when the reborn Monaro was launched at the close of 2001. "We will not allow the Monaro to die a long and drawn out death. We will make sure that the model goes out on a high." Not only has he been true to his word but there could be more to come.

McKenzie showed more insight than most when he anticipated that Monaro sales would peak very quickly then die like all coupes as fickle 'feel good' buyers move on to the next fad. Coupes in Australia have a bad habit of becoming a dead albatross around their maker's necks with a disastrous impact on resale as they are cleared under distress pricing. McKenzie, who has been around Holden long enough to remember how the earlier Monaros were left to wither on the vine, was driven to make sure this would never happen with the new one. 

To mark this week's announcement was the news of a special final edition, the CV8-Z. It promises to be the best and most desirable of all Holden-badged Monaros. It will also be the best value when it carries the same pricetag as the standard VZ Monaro CV8. 

While this new CV8-Z is something to celebrate, the process is driven by hard core pragmatism. Currently, local Monaro sales are running at around 250 per month. Factor in the August release of the CV8-Z and its limited production run of 1200, it quickly becomes apparent that Holden is intent on maintaining four full months of Monaro sales at its current 250 monthly sales rate until the very end. That last day in December 2005 when the final CV8-Z has to be cleared is the clue as to what is really happening.


Euro III: To be or not to be?

Prior to the September 2004 VZ Monaro launch, the local Monaro was struggling no matter which way you looked at it. Although Holden launched it as the separate V2 series in 2001, it was obvious to just about everyone that it was falling further and further behind the mainstream Commodore range despite Series II and III upgrades. Persistent rumours that Holden was offering special deals to company insiders to clear the last of the V2 Series III Monaros were plausible.

Today's Monaro went into production on a worst case scenario of 7500 sales, a pathetically low figure that forced the amazing band of enthusiasts within the company to deliver the new model under incredible cost pressures. This is why the new Monaro arrived offering little more than a svelte-looking two door alternative to an everyday Commodore. 

At the time the minimum 7500 sales figure was calculated, the local market could have gone either way and no one dared predict the sheer scale of the successive boom markets that greeted the new Monaro. Yet by September 2004, the Monaro had chalked up only 8700 sales during a period that the new car market grew by more than a third. To even the most generous number cruncher, the Monaro was a close call. Australian buyers had every reason to lose interest by 2004 as soft Monaro sales starved it of development funds, and Holden never intended Monaro to go beyond VYII, or July 2004, anyway.

Enter Bob Lutz, GM's product czar at large, who decided that a Monaro was exactly what Pontiac needed for its next GTO. Because Holden didn't have the money to engineer any real attitude into the Monaro, the soft Pontiac nose only highlighted what was missing. Even if the Pontiac GTO initially failed to meet its US target, 15,000 US sales plus 8700 local sales was like winning the lottery in terms of development funds. Indifferent GM drivetrain engineers in the US who couldn't see anything wrong with the rubbish they were sending to Australia suddenly had to do something when their own market wouldn't accept the dreadful transmissions and soft engines.

When all seemed lost, Holden delivered the unbelievable VZ Monaro last year after adapting the first stage of Pontiac improvements including an edgier LS1 engine, new 6 speed manual and heavily revised auto plus the US market's dual exhausts and fuel tank. Pontiac's bonnet vents, even if they didn't suit the Monaro grille as well as the Pontiac, told everyone that the Monaro was back with a vengeance. It was the first time that the Monaro shared the same model code with the current Commodore and sales revived. 

If that wasn't enough, HSV engineers spent a fortune on adapting the second stage of Pontiac improvements to its Coupe GTO model by offering the Corvette's powerful new LS2 engine. In the process, both the Monaro and the HSV Coupe found an eager export market in the UK now firing on all cylinders after Vauxhall's Australian chief rebadged both models as Vauxhalls. As the 40,000th Monaro-based example is sold this month, the original 7500 sales projection is blown out of the water. Ironically, this leaves Holden without a version of its own.


No Monaro LS2?

Holden painted itself into a corner last year and had no choice but to make this week's announcement while other Monaro models continue full steam ahead. Holden made a promise that only HSV would get the latest Pontiac GTO's LS2 engine in Australia. Despite media speculation that Holden would renege and offer an LS2 Monaro, McKenzie assured CarPoint that Holden has no intention of breaking that commitment. This is welcome news to HSV owners who have paid a big premium over Monaro buyers for the special LS2 drivetrain. 

HSV's version of the Monaro not only features the latest LS2 V8 but it also gained a unique wiring harness to support the next generation ABS and traction control. It was also engineered to continue seamlessly through new Euro III emissions requirements that apply from January 2006. It currently makes up 20-25 per cent of HSV sales and it is not in Holden's interests to sabotage these sales. Unlike the Monaro, the HSV Coupe was always intended to run well into 2006. 

The reality is that the current VZ Monaro CV8 and its LS1 engine were not slated to meet Euro III when it was all but dead in the water last year. Euro III could not have come at a worse time for Holden as the whole VZ range has to be upgraded when it is only six months away from replacement. 

Despite the sales revival, Holden simply does not have the resources for a Euro III version of the Monaro CV8 while finalising its all new VE Commodore range ready for its 2006 release. When Holden might only sell 1500 Monaros next year, it also makes no sense financially.

And this is where it gets interesting. McKenzie and other passionate Holden executives are also on the HSV board and the relationship is very close. McKenzie is well aware that the special final versions of the earlier Monaro, the HX LE, were built in Sydney's Pagewood factory, the former home of the Statesman. Thus there is a precedent for a special Monaro to be built outside the normal Holden system. 

McKenzie indicated that he and his Holden colleagues are seriously considering their options after the CV8-Z sells out while protecting LS2 exclusivity for HSV. 

Could Holden commission HSV to build a very special final edition Monaro with LS2 engine? CarPoint has reason to believe that this is under serious consideration especially now that US Pontiac GTO sales have hit their original target. There is no way that Holden can afford to lose this many Vauxhall and Pontiac export sales until a decision is made on the Monaro's replacement, which could mean it survives beyond VE as an export. A special variation of an existing HSV model which in turn is based on the export models is still consistent with Holden's commitment to reduce the number of models. 

If it does happen, it won't be cheap as it can't undermine HSV models. That must still leave the CV8-Z as the most affordable and almost certain collector's item but the glint in McKenzie's eye suggested he isn't quite done yet.


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