Import plan slammed

Proposal for private new-car imports “Irresponsible”

DAVID HASSALL

THE Federal Chamber of Automotive Industries has ridiculed a government-led push to allow parallel (‘grey’) imports of new or near-new cars.

The FCAI, which represents car companies in Australia, says the government’s plan is “irresponsible and shortsighted” and shows a “complete disregard for the serious consequences that would flow”.

FCAI chief executive Tony Weber said it would fly in the face of Australia’s highest level of consumer protection, leave buyers stranded without service support, introduce cars unsuited to Australia and not achieve the intention of reducing prices.

The government’s proposal, part of a shakeup of the Motor Vehicle Standards Act, would allow buyers to bypass Australian showrooms and order a new right-hand-drive car (or one up to a year old) from anywhere in the world.

On paper, it looks good for buyers. The government has promised to cut red tape introduced to protect jobs in the local carmaking industry, increase competition in what is already one of the world’s most crowded markets and potentially push newcar prices even lower.

As part of the review, the government is also looking at streamlining Australian Design Rules to bring them into step with international standards, a move it says could save the car industry $281 million a year. All up, the government anticipates the more relaxed import restrictions could save about $1 billion a year.

The push, on the table since January 2014 and led by assistant minister for infrastructure Jamie Briggs, has the support of the Productivity Commission, the Competition Policy Review Panel and the Australian Automotive Aftermarket Association, which represents car repairers and accessory retailers.

Mercedes-Benz Australia spokesman David McCarthy warned of the issues facing consumers. “How is the government going to protect the consumer who buys a car online?” he said. “Has it been involved in an accident; is it under finance; has it been stolen; is it as described?”

The proposed changes, expected to take effect once Ford, Holden and Toyota cease local manufacturing by the end of 2017, are open for debate until the end of May. The government will deliver its decision later this year.

Grey area

PROPOSED guidelines for parallel importing will only allow buyers to bring vehicles into Australia that are less than 12 months old, and with fewer than 4000km on the odo.

In 1984, New Zealand relaxed vehicle import laws, allowing cheap second-hand cars to flood the market. Last year, used imports into NZ exceeded new cars by 138,000 to 127,000.

Assistant minister for Infrastructure Jamie Briggs said the government was not inclined to deregulate the Australian used car market. “The experience in New Zealand has been that opening up used car market imports has increased the age of the fleet on the road, which means you get worse safety outcomes,” he told the ABC.