Car maker Holden has been urged to declare its hand as speculation increases it will close its Australian manufacturing operations.

The future for car maker Holden looks increasingly bleak, with pressure growing on the company to decide on the fate of its local manufacturing operations.

Holden has dismissed as speculation reports, sourced to senior federal government figures, that it has already decided to close by 2016.

But Prime Minister Tony Abbott has also rejected spending more public money to keep the company building cars in Australia, something thought essential for Holden to stay.

“I think they owe it to the workforce, they owe it to the suppliers, they owe it to the people of Australia to say what they’re doing,” Mr Abbott said on Friday.

“Are they staying or are they going?”

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 2015.

South Australian Premier Jay Weatherill said that made a mockery of the federal government’s review of car industry assistance by the Productivity Commission.

He accused sections of the federal government of deliberately undermining the process to secure Holden’s future.

“They want to create the most hostile environment so that Holden will actually take the decision out of their hands by just simply closing,” Mr Weatherill said.

The premier said he had spoken to Holden boss Mike Devereux, who had rejected the closure reports and reaffirmed no decision had yet been made.

The company also issued a bulletin to workers telling them they would be the first to know of any decision.

The company said it remained fully committed to the negotiation process and to also taking part in the Productivity Commission review.

Mr Devereux spoke with workers in Adelaide on Thursday and is due to front the commission on Tuesday.

Australian Manufacturing Workers Unions state secretary John Camillo said Mr Devereux was upbeat in his comments to staff and made no mention of closure.

He said those same workers were now devastated by what they were reading in the media and wanted to know where they stood, preferably before Christmas.

Absentee rates at Holden were increasing due to the stress created by the uncertainty, though the union ruled out taking industrial action.

“We’ve got workers, we’ve got families, we’ve got communities who are really worried about whether Holden is going to survive or not,” Mr Camillo said.

“Workers’ lives are at risk, because of the politics that is being played by all sides. This has gone too far.”

Federal opposition industry spokesman Kim Carr said the government should have sent a delegation to General Motors in Detroit to discuss the future of Holden.

Senator Carr said the coalition had been “incredibly indolent, lazy” about developing a plan for the auto sector.

Holden last year agreed to a $275 million assistance package in return for developing and building two new model cars in Australia from 2016.

However, it is now thought to need as much as $500 million and has repeatedly warned that its local operations are not sustainable without ongoing support.