Industry sounds warning on vehicle import reform

THE Victorian Automobile Chamber of Commerce (VACC) and Mercedes-Benz Australia/Pacific have urged the federal government to proceed with caution as it institutes a fresh review into the automotive industry focusing on import regulations.

As GoAuto has reported, the government is now reviewing the Motor Vehicle Standards Act 1989 and will consider reducing regulation and relaxing restrictions on second-hand vehicle and new-car parallel imports after Australia’s car manufacturing industry shuts down by the end of 2017.

This is in line with the Productivity Commission’s recommendations, and the VACC has lashed out at what it regards as “hare-brained” and “half-baked” ideas that will allegedly improve choice and prices for Australian car buyers.

According to VACC executive director David Purchase, the government should sensibly discuss the development of strategies to ensure a sound future for the automotive sector and consumers beyond local manufacturing.

“The entire automotive industry needs time to adjust and discuss with the federal government strategies to take the industry forward,” he said.

“Instead, we are hit with one pointless hare-brained idea after another, from politicians, the Productivity Commission and other social commentators.”

Mr Purchase said relaxation of regulation and a flood of new and used cars would not, in fact, increase consumer choice or reduce red tape.

“The reality is it would bring the exact opposite, with so many problems that motorists and businesses would become bogged down in paperwork and consumer detriment would escalate,” he said.

Mr Purchase said the federal government appeared to be taking advice from “people with little or no automotive industry experience” and that the Australian Motor Industry Federation (AMIF), which comprises the various state motor trades bodies, had been forced to correct misunderstandings about the possibility of new imports into the market.

He also said that any thought of enabling direct imports of new cars by consumers, with no safety, security or consumer rights regulations in place and with no guarantees or warranties, had led the AMIF/VACC to “really wonder what our politicians and so-called automotive industry experts are doing”.

“We are concerned about lurching from one baseless idea to another, groping in the dark for a solution, when the answer is staring everyone in the face: come and talk with the automotive industry first,” he said.

Mercedes-Benz Australia/Pacific senior manager of public relations, product and corporate communications David McCarthy said a plan to allow direct imports of new cars would undermine the level of expertise and service, threatening significant numbers of apprenticeships and training regimes.

“This enviable level of technical capability and capital investment, not to mention employment, will be placed at risk for no identifiable consumer benefit,” he said.

“There is a real and present risk that investment, skills training and employment levels will be adversely impacted not just by the uncertainty that now exists but by the possibility of decisions made to change the nature of a market that is operating effectively, efficiently and for the benefit of the Australian consumer.”

Mr McCarthy also said prices and equipment levels were at a 20-year low, and that the market had never been more competitive.

“There is no market failure,” he said, adding that “if the government is really concerned about reducing the cost of cars they could do it right now with a stroke of the pen and scrap the luxury car tax”.