15 December 2017
TO: ALL AADA MEMBERS
SUBJECT: ACCC New Car Retail Study
The Australian Competition and Consumer Commission (ACCC) has released its final report for the new car retailing industry market study.
Of particular significance in this final report, is the fact that the ACCC has picked up on the AADA’s strong advocacy in relation to the power imbalance between new car dealers and vehicle manufacturers. The report says there are a number of issues related to dealer-OEM relations which require more thought. These include: Minimum tenure and capital investment requirements; Non-renewal practices; Changes to commercial arrangements; Reimbursement for remedies.
The study’s findings create a significant opportunity for AADA to work towards an automotive industry code which we believe will address our main concerns with many OEM franchise agreements and administrative policies.
As flagged in the August draft report, ACCC has recommended a mandatory system for the sharing of service and repair information with independent repairers. However, we are pleased that our insistence on a secure process for sharing of sensitive safety, security and emissions information has been taken up in the final report.
This study has been running for 18 months and the AADA has expended a great deal of time and resources on this project. We have developed a good working relationship with the ACCC and it is encouraging that our voice has been heard on a number of issues.
Below is a summary of the key recommendations, findings and actions from the report:
Consumer guarantees and warranties (including the impact of commercial arrangements between car manufacturers and dealers)
- The ACCC to work with OEMs and dealers to develop information on consumer guarantees to be provided at point of sale
- ACCC will work with other ACL regulators to update the Motor vehicle sales & repairs – an industry guide to the ACL (August 2013)
- Car manufacturers should transform their approach to consumer guarantee claims, including reviewing and updating their dealer agreements
- Issues related to the imbalance of power between OEMs and dealers may require further examination, potentially through next review of the Franchising Code of Conduct.
Access to technical information to repair and service new cars
- As flagged in draft report, ACCC has recommended a mandatory scheme for OEMs to share technical information with independent repairers.
- Process for the secure release of environmental, safety and security-related information should be under the mandatory scheme.
Parts, fuel consumption labels and telematics
- OEM branded parts and accessories should be generally available to independent repairers on commercially fair and reasonable terms
- Changes to the fuel consumption label affixed to new cars should be considered to improve the comparative use of the information supplied
- The ACCC supports the Australian Government’s intention to legislate a Consumer Data Right sector-by-sector
For a full list of the ACCC’s recommendations, findings and action, please click here
The ACCC has also prepared factsheets for dealers, which you can access here.
For further information, please contact:
James Voortman Executive Director Policy & Communications
Australian Automotive Dealer Association Ltd
M: +61 452 535 696