The closure of Holden's Australian operations is one option being considered by US parent company General Motors, South Australian Premier Jay Weatherill said after meetings in Detroit overnight.

Mr Weatherill, Federal Manufacturing Minister Kim Carr and Holden managing director Mike Devereux held talks with GM chief executive Dan Akerson in America's "motor city".

The Premier says while he strongly urged GM not to shut down its Australian arm, he conceded the option was one of several being considered by the company.

"It's a possible scenario, and of course we're doing everything we can to resist that," he said.

"But the truth is that car making is a global industry, so the future for Holden in South Australia and importantly the components suppliers in South Australia will involve us making sure that we've got a secure place in that global industry."

The meeting in Detroit comes as Ford announced a $103 million upgrade, including state and federal assistance, to boost the efficiency of the Falcon and Territory models built in Victoria, ensuring production to at least the end of 2016.

Mr Weatherill says the State and Federal governments may also have to prop up Holden's operations in the short-term to ensure its long-term survival.

"I think [GM is] committed to working with us to securing Holden's future in Australia, and in particular the Elizabeth plant, but it will be contingent upon us reaching an agreement," he said.

"Part of that agreement will involve both the Commonwealth and State governments making a substantial co-investment in the future of the Elizabeth plant."

"We are prepared to make a co-investment to make sure that Holden stays here, but we don't want it to be just a rescue package.

"We want it to be something that's going to sustain them into the future."

Mr Weatherill says the Commonwealth will bare the substantial burden.

"In the past there have been packages of this sort concerning the introduction of new models which have required new platforms for the construction of new models of the vehicle, but on this occasion what I'm keen to insist on is that any money that's provided to Holden comes with some very clear commitments about securing the future for not only Holden but also the components suppliers."

Holden employs 4500 workers in Australia, with most at its Port Melbourne and Elizabeth plants.

Critical investment

Jon Gee from the Manufacturing Workers' Union's vehicle division says Government investment will be crucial if Holden is to survive.

But he says there are economic advantages to keeping the manufacturing base in Australia.

"General Motors clearly wants to build cars where they sell them. It doesn't make sense to have two or three million cars circling the globe on ships at up to $1000 a car. It's an amount of money you don't have to spend," he said.

A spokesman for the Premier has admitted Mr Weatherill was told last month that closing Holden was a real possibility, before he began his trip to the US.

In a written statement, Holden says the Detroit meeting was productive, and says the company is committed to working with Australian governments to ensure the survival of the local industry.

'Hard times'

Manufacturing Minister Kim Carr says the high Australian dollar is placing stress not just on Holden but across the manufacturing sector.

"Our task is to ensure that we are flexible and that we are adaptive and that we are able to work with individual companies to see the industry transform itself, reinvent itself," he said.

"To work to ensure that there are high-skill high-wage jobs for the future for Australian workers."

Senator Carr says Holden must become geared to build newer energy-efficient cars to remain competitive.

"We are looking to work closely with the company to develop specific proposals about 'next generation' models so that we are able to look to the future with confidence and secure the future of the Elizabeth and facilities in Port Melbourne," he said.

"There are 4500 people that work at General Motors and we are very keen to ensure there is a strong business case so that those jobs can be there into the future and we can see the industry as a whole prosper in what have been very very difficult times.

"These are matters that have yet to be finalised and there needs to be more discussion about the detail of these proposals but we are clearly seeing in these discussions an indication of the support and commitment to the automotive industry."