MTAA advocated strongly on behalf of its members and their business constituents so that the ACCC New Car Retailing Market Study focused on areas of their concern. In particular, MTAA and state and territory member associations advocated strongly for the ACCC to:
- Confirm the impact and identify a solution to ensure fair and reasonable access and use of technical and repair information for independent mechanical and motor body repairers.
- Examine concerns surrounding proposed changes to Australian Consumer Law definitions of major and minor faults, among other issues.
To ensure the ACCC focused on the needs of MTAA member associations’ business members, MTAA provided an in-depth submission and supplementary submission to the ACCC. These submissions included comprehensive overviews of the automotive industry (including case studies), highlighted the imbalance of the Franchising Code and Dealer Agreements in favour of manufacturers, the lack of clarity surrounding consumer guarantees and warranties, the impact of electronic logbooks and dealer stamps, and the limitations of access to repair information and data on new cars for independent repairers.
MTAA also provided the following recommendations to the ACCC:
- The ACCC afford the automotive sector a further (and potentially final) opportunity to deliver a balanced, industry-led, solution that guarantees access to repair and maintenance information within a specific timeframe.
- Such a solution should include the development and implementation of a process, mechanism or scheme for the accreditation, approval and authorisation to access all Repair and Maintenance Information (RMI) including security related information.
- If the automotive sector cannot deliver such a solution within the specified timeframe then further consideration is given to the development and implementation of a Voluntary Code of Conduct oversighted by the ACCC.
- The Franchising Code of Conduct requires either addendums or supplementary schedules to give prominence to the specific matters peculiar to the new car retailing industry and the ‘Dealer Agreements’ that are core to it.
- Equal prominence must be afforded to the ‘complete picture’ of the new car market supply chain particularly the existence of multiple profit centres and value contributions.
- Sanctioning out critical product offerings and profit centres such as insurance and finance risks undermining a complete understanding of the new car market.
- Dealer Agreements and the relationship between manufacturers / distributors and dealers require deep analysis to properly understand the operating environment of new car retailers.
- ACCC give more protection to automotive businesses under Australian Consumer Law (ACL).
- Provide definitions in the ACL in relation to complex products such as motor vehicles. Specifically, the Australian Competition and Consumer Act 2010 should:
- define a major fault;
- define a minor fault;
- define what constitutes reasonable time;
- include businesses that purchase goods and services in the course of trading,including where they are held liable for the fault of a product supplied by a manufacturer;
- in the definition of consumers; define the terms ‘unconscionable conduct’ and ‘misleading’ and ‘deceptive’ conduct ,and ‘reasonable person’; and
- require plain English guidance for consumers, businesses, regulators and mediation and arbitrationproviders that are consistent and a common point of reference for all parties.
- The obligations and responsibilities and roles of various actors within ACL be defined and an awareness and education program be developed and implemented nationwide to enhance the understanding andapplication of the ACL in relation to complex products such as new motor vehicles.
- Lemon Laws are not to be pursued as a national policy, regulation, position, or solution to potential problems withan extremely small component of a market of over 1 million sales per annum or in addition to protections and guarantees already available in the ACL.
- The introduction of ‘Lemon’ laws will create an unrealistic expectations of the types of claims that can be redressed and add to the level of grievance and agitation being experienced by those few consumers who are having difficulties, when compared to the overall market.
- Further consideration be given to the potential for enhanced awareness and education of the provisions of the ACL including requested clarity and definition and their application from a consumer perspective.
- The proper role and accountability of manufacturers and distributors in the delivery of effective warranty provisions and service work associated with warranties be investigated and better defined and included inany changes to the ACL and / or Franchising Code.
- The role and accountabilities of Dealers in undertaking warranty work for a manufacturer / distributor be better defined and included in any changes to the ACL and / or Franchising Code.
- The role and accountabilities of any other service provider in undertaking warranty work for a manufacturer/ distributor be better defined and included in any changes to the ACL and / or Franchising Code.
Please access the following links for the MTAA submission and supplementary submission into the ACCC New Car Retailing Market Study:
- MTAA submission for final report: Download .pdf
- MTAA supplementary submission for final report Download .pdf