Voices

Second-hand car imports – let’s have them!

17 Apr 2015

Robert Pepper 1

Holden, Ford and Toyota are soon to shut up shop, and when that happens all of Australia’s new cars will come from somewhere else. So, what’s all the fuss about allowing second-hand car imports?

YOU MAY HAVE noticed that Australia no longer has a automotive industry…

Except that’s not actually true. The real story is that the big 3 automakers – Toyota, Holden and Ford – will no longer make cars here. But actually, we do have an automotive industry – our world-leading 4WD aftermarket companies, tiny players like Tomcar, startups like Joss Supercars and that’s just the manufacturers let alone the service industry.

These companies aren’t rent-seekers begging for handouts because of problems they created by themselves, they’re just plugging away, growing slowly but surely.  We can and should be proud of these guys, and let me tell you that “Australian 4WD gear” in Europe and the USA means the same as “German/Euro engineered” over here – it’s an instant mark of respect and quality, earned over time and maintained by continuing great results.

But back to new cars, for which the Aussie consumer pays over the odds despite our competitive car market.  The reason why prices are high is simple, it’s because we pay what’s asked, same as the difference for any other goods.  And when you have a market that the existing players can make decent margins from, naturally said players are resistant to any change.  Such as importing secondhand vehicles for sale to the public, a idea mooted now we don’t have a conventional car manufacturing industry to protect.

So what do we hear from the VACC, that open-minded bastion of fairness?

““Recent calls to flood Australia with used car imports and enable consumers to directly purchase new cars from overseas were made in the name of red tape reduction and increased consumer choice. 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.”

“It is frustrating because many of these ideas are generated by people, with little or no automotive industry experience and the Government appears to be reluctant to speak directly to the automotive industry itself.  Mixed messages also cause confusion and some consumers might delay the purchase of their new cars in light of this public debate.  “

So, hyperbole – “flood” – nobody said that – and it wasn’t ever about “red tape reduction” but cheaper prices, which has been conveniently omitted from the list of doom.  The claim about increased paperwork for consumers is a complete furphy with no evidence to back it.  And of course the industry should be consulted, but let’s be fair, any industry is going to promote policies good for its own profit, not good for the customers who support the industry.

So to the reality.  If we allow imports that meet our safety standards then yes, prices for cars will drop because you’ll be able to pick up say a newish Pajero, Land Cruiser or what have you for a lot less than the equivalently aged model here.  On April 16th, the Assistant Minister for Infrastructure and Regional Development Jamie Briggs announced imports would be permitted provided the vehicle was less than 12 months old and had travelled less than 4000km. That has to put a downwards effect on prices, and you’d also get more choice – shortie GU Patrol anyone?

Now explain how that’s a bad thing?

There is an argument that the average age of the cars on Aussies road will increase, but I’m not seeing that logic at all. I’ve heard of a New Zealand stat around age going from 11 to 13 years, but no context or analysis.

So if we had secondhand imports that’d mean people can afford more cars, or safer cars.  As for paperwork, a well-run import company can easily handle that, and many already do.

Next argument is safety, or not meeting Australian standards.  First off, Aussie standards are often unnecessarily out of sync with those in Europe and the USA – the classic examples being ISOFIX childseats, and the angle you need to see tail lights at which is why those silly little lights are installed in the bumpers of Pajeros and Patrols, and the big sensible lights disabled.  But that’s just a diversionary comment, while I’m making myself popular with the authorities and car manufacturers. In fact, if the car manufacturers want to lobby about something may I suggest the roadworthy standards!

Another anti-import argument is the special tuning and standards required to operate a vehicle in Australia.  This has some merit, but limited merit.  Suspension might be tuned differently for Australia for example, but fundamentally the differences are minor and for many cars are easily changed or simply ignored.  I’m yet to see a list from the anti-import people of such changes required, other than darkly vague hints.

Then there’s warranty. True, you won’t get a warranty on a near-new car purchased overseas and then imported. But, if the price is good, you probably won’t worry anyway. Many people trash the warranty on their new cars with turbos, big wheels, suspension lifts or lowers… you name it.  That’s not a problem for many people, so how about letting the public decide what’s important to them.

The real point is this – if an imported car can pass our safety standards, let it through, and there’s absolutely no reason why imports wouldn’t pass with flying colours. In fact, the only way there would be a problem is if unnecessary standards were created just to make life hard for imports, but that’d never happen so all will be well.

So, can anyone see any reason why we shouldn’t now allow second-hand car imports? Is there any evidence or logic behind the rhetoric against imports?