Government drops parallel imports plan

The Australian Government has abandoned plans to introduce a bill allowing parallel imports after “extensive industry consultation”.

The changes would have meant consumers could ‘bypass’ dealers (or go to a private import provider) to buy an allegedly cheaper new car.

It will instead introduce a Road Vehicle Standards Bill it says will strengthen consumer protection and modernise the laws governing road vehicles, effective from 2019.

In addition, the government has announced changes to the Specialist and Enthusiast Vehicle Scheme criteria (SEVS) which will allow specialist imports to only meet one of six, rather than two of four, criteria.

The six criteria allow a car to be imported under SEVS if:

• The car has more than 110kW/tonne if built in 1992 (or over an extra 1kW/tonne for each year following)
• The vehicle’s drivetrain is based on an alternate power source to internal combustion or it is in a micro-car subcategory for low power (low emissions) vehicles (such as a Kei car)
• It was originally manufactured or fitted from the factory with substantive specialist mobility features to assist people with disabilities
• Total production of the vehicle make is less than 3000 units per year, model is less than 1000 units per year, or production of its variant is less than 100 per year. In addition, “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.”
• The vehicle was originally manufactured as a left-hand drive vehicle and not available as an OEM RHD vehicle in another world market. These vehicles will require conversion to right-hand drive
• The vehicle was originally built as a caravan or motorhome.

The decision not to allow parallel importing has been slammed by groups such as the Australian Imported Motor Vehicle Industry Association (AIMVIA).

The AIMVIA says the move will cost the automotive import industry hundreds of jobs.

2

“Without this competition in the marketplace, Australians will continue to pay some of the highest retail prices for vehicles in the western world,’ the AIMVIA says.

"It will mean the decimation of our industry, there's no other way to describe it,” says AIMVIA president Jack Sandher and co-owner of a Sydney-based import company.

However, a statement from minister for urban infrastructure Paul Fletcher says the government found that price differences between buying new in Australia and undertaking the personal import are “estimated to be less than two per cent across the market.”

Reinforcing this estimate is Mercedes-Benz corporate communications manager David McCarthy, who also made a case to the government on behalf of the FCAI and the automotive industry in Australia.

“We’ve been on this for nearly three years, and it’s taken an awful lot of effort to make the case, but at the end of the day I’ve had to come up with compelling reasons and evidence-based facts,” McCarthy told MOTOR.

“The proposal that was around didn’t actually provide any level of protection for the consumer, it potentially could have had unsafe vehicles on the road, and that doesn’t appeal to us.”

He also says the price argument falls apart when you consider that most buyers don’t actually pay sticker price for a new car.

“If someone thinks they can save, say $100K on this, the reality is everyone buying a car has always negotiated the price.”

He did, however, praise changes to the SEVS criteria which mean an import only has to meet one of six criteria.

“I think an enthusiast has a better ability to properly import a car, as opposed to Joe Public who is potentially falling into the hands of unscrupulous people. [Enthusiasts] can protect themselves.”