The carbon tax may have a bigger impact on the South Australian economy as Holden's parent company weighs up whether to keep production in Australia.

Holden's managing director Mike Deveroux predicts running costs may increase by $40 to $50 million a year and they would need some kind of offset program to help the industry survive the transition.

He also says Australia is raising the cost of doing business while the rest of the world is not, making it an easier decision to move jobs overseas.

The government's decision to remove the green car innovation fund has also made it more difficult for the car company to do business here. The fund was abolished so the government can pay for the post flood clean up in Queensland, it was originally meant to run until 2020.

If parent company General Motors decides to move production offshore it will mean hundreds of job losses for South Australia.

Photo:Getty/Getty Images News/Ian Waldie/Staff