Personal importation of new motor vehicles proposal dropped by Government
The Australian government is dropping its push to allow the personal importation of new motor vehicles into Australia and has instead tightened the rules.
IN FEBRUARY 2016, THE federal government announced it would make significant changes to the law governing the private importation of new vehicles, which would have allowed Australians to import one new car from right-hand drive countries overseas every 12 months. In a statement issued today by Paul Fletcher the Minister for Urban Infrastructure, the government said it would not seek to implement these changes.
In a statement, Minister Fletcher said: “After further detailed work on implementation arrangements, the Turnbull Government has decided not to proceed with one element of changes proposed earlier, which would have allowed personal importation of new motor vehicles from the United Kingdom and Japan.
“That work has highlighted the cost and complexity of providing appropriate consumer awareness and protection arrangements, including investigation of each vehicle before it was imported to Australia; ensuring consumers were aware that the manufacturer’s warranty may not apply in Australia; and establishing systems to deal with a manufacturer’s safety recall.
“It would also have been necessary to ensure that subsequent purchasers of a vehicle, which had been personally imported into Australia as a new vehicle, were aware of this fact – and the consequences of this, such as the manufacturer’s warranty not applying.
“Weighing these issues up against the modest benefits of the personal import arrangements – including price reductions estimated to be less than 2 per cent across the market – the Government has concluded that the benefits do not justify the cost and complexity of this particular change,” Minister Fletcher, concluded.
However, the Minister’s announcement has been met with dismay by imported vehicles businesses which claims that if the Bill is passed by Government then it would decimate its industry, and that the new proposal is nothing like the proposal it mooted last year
Speaking with Practical Motoring, Kristian Appelt, director at Iron Chef Imports, said: “This proposal will decimate the imported cars industry with many hundreds of job losses expected; many in this industry are already starting to look for a way out.
“This industry needs volume and there is nothing in this proposal that suggests there will be any opportunity for a business like mine to generate volume; our volume is down by half since 2007. We’ve now, under this new proposal, lost vans which made up almost 70% of our volume and the Environmental Performance criteria suggests only electric-only vehicles will be accepted, and that hybrid vehicles won’t be eligible, which is another volume loss.
“After what was proposed last year to what’s been proposed today is like chalk and cheese. There are a lot of very unhappy people in my industry today,” Appelt said.
The FCAI which lobbied against changes to the personal importation laws issued a statement describing the Government’s proposal as a “a win both for consumers and for the industry”.
“The industry has long held the view that personal imports are not in the interest of consumers, nor of the 236,000 people who are either directly or indirectly employed in the Australian motor industry,” Mr Weber said.
“Australia already has one of the most competitive motor vehicle markets in the world, delivering world quality vehicles and outstanding value for the consumer.
“To allow personal imports would have exposed consumers to enormous risks, which the Government’s own analysis has clearly identified.”
In its statement, the FCAI said: “The Government also announced a significant regulatory changes to the concessional scheme under which unique, specialist and enthusiast vehicles can be imported to Australia. The FCAI believes that on the surface while there is merit in these changes, it is keen to work through the detail with the Government on elements of the revised scheme to ensure the necessary consumer protections are in place”.
Australian Imported Motor Vehicles Industry Association (AIMVIA) President, Jack Sandher was blunt in his rebuttal of Government’s new proposal, saying in a statement: “It will mean the decimation of our industry, there’s no other way to describe it. The association and its board has devoted hundreds of thousands of dollars and countless hours to regular meetings with politicians and departmental staff across Australia over the last four years, only to be ignored at the finish line. At a time when the automotive industry is already shrinking, it is ludicrous that the “government for small business” is prepared to watch 142 small-to-medium enterprises go to the wall for the sake of protecting the profits of overseas vehicle manufacturers.”
AIMVIA also stated it had “grave concerns for the integrity of the Motor Vehicle Standards Act review process itself. It has recently come to light that a senior government official charged with the task of overseeing the policy review and revision has just accepted a newly-created role within one of the industry associations heavily petitioning the government to tighten the Act and prevent further competition. AIMVIA intends to investigate this matter further,” the statement concluded.
Continuing in his statement, the Minister said the Government was committed to reforming the Motor Vehicle Standards Act and would introduce its new Road Vehicle Standards Bill into Parliament before the end of this year. If the Bill passes into legislation, the government said it would take effect from 2019.
What is this new Bill? According to Minister Fletcher, the Government’s Road Vehicle Standards Bill will “modernise and strengthen the laws governing road vehicles when first supplied to the Australian market; clarify vehicle recall arrangements; accelerate harmonisation of vehicles with international standards; and provide more choice through streamlining and consolidating the regulatory pathways through which non-standard vehicles are imported”.
The Bill will also seek to reform vehicle recalls and have them apply to both private and commercial vehicles. In addition, all new vehicles sold in Australia will require a “secure vehicle identification marking on new vehicles. This requirement will provide a significant deterrent to motor vehicle theft and re-birthing”.
While the Government has abandoned its extensive motor vehicle imports proposal it has, it claims, made it easier for Australians to import “specialist and enthusiast vehicles”.
“This includes expanding the range of vehicles eligible for consideration as a specialist and enthusiast vehicle, with vehicles now to be required to meet only one of six eligibility criteria instead of meeting two out of four eligibility criteria as was previously required,” Minister Fletcher said.
The six eligibility criteria are:
Performance – a new graduated threshold formula measured from 110 kilowatts per Tonne (kW/T) in 1992, increasing by 1 kW/T each year after.
Environmental Performance – an objective vehicle technology based on an alternate power source to internal combustion or a micro-car subcategory for low power (low emissions) vehicles.
Mobility – originally manufactured or fitted from the factory with substantive specialist mobility features to assist people with disabilities.
Rarity – total worldwide production of the vehicle ‘Make’ is less than 3000 units per year; or total worldwide production of the vehicle ‘Model’ is less than 1000 units per year; or total worldwide production of the vehicle ‘Variant’ is less than 100 vehicles per year. Left-hand drive vehicles imported under the rarity criterion will not require conversion to right-hand drive but will need state or territory agreement for use on their roads.
Left-hand drive – originally manufactured as a left-hand drive vehicle and not available as an originally manufactured right hand drive vehicle in another world market. These vehicles will require conversion to right hand drive for safety reasons.
Campervans and Motorhomes – originally manufactured as a campervan or motorhome.
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