Archives: Dealer Bulletins

Today the Government released its response to the Independent Review of the Franchising Code undertaken by Dr Michael Schaper, undertaken in late 2023.

The Government has agreed, or agreed in principle, to all of Dr Michael Schaper’s 23 recommendations.

Disappointingly, the Review didn’t address many of the issues the AADA raised during the Code Review, including the need for strong protections against termination and non-renewal and the need for compensation for loss of goodwill. However, the AADA is encouraged by a number of recommendations.

• Recommendation 4: Service and repair work conducted by motor vehicle dealerships should be explicitly captured by the Code.
  Government statement: Agree.
  Service and repair work is an essential part of motor vehicle dealerships.
  When remaking the Code, the Government will clarify that service and repair work performed by motor vehicle dealerships is within the scope of the Code.
• Recommendation 23: The Australian Government should investigate the feasibility of introducing a licensing regime to better regulate most aspects of the franchisee-franchisor relationship.
  Government statement: Agree.
  The Government will establish a Taskforce in Treasury to conduct a comprehensive cost benefit analysis of introducing a licensing regime for the franchising sector. The Taskforce will consult widely and provide advice to Government.

The AADA also supports the Government’s commitment to expand some protections for vehicle dealers in Part 5 of the Code to all franchisees. Including requiring all franchise agreements to provide a reasonable opportunity to make a return on investment, and to ensure that franchisees are appropriately compensated if their agreement is terminated early. This is a step in the right direction, but more needs to be done, and the AADA will continue to advocate that Truck Dealers should enjoy all the protections under Part 5 of the Code.

The AADA is acutely aware that the industry is undergoing significant changes and that policies such as the New Vehicle Efficiency Standard will bring some challenges for Dealers. This highlights the importance of continuing to advocate for stronger franchising protections for Dealers, and that changes imposed on Dealers by their OEMs should be done in a fair and transparent manner with compensation where appropriate.

The AADA will engage with the Government as it seeks to implement these recommendations.

You can view the Government’s Response here.

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On 26 August 2024, some of the amendments made to workplace relations laws under the Fair Work Legislation Amendment (Closing Loopholes No. 2) Act 2024 come into effect.
Key amendments that may be relevant for dealers are related to casual workers.

• New Definition of Casual

From 26 August 2024, an employee will be a casual employee only if the employment relationship is characterised by an “absence of a firm advance commitment to continuing and indefinite work” having regard to key factors outlined in the below guidance material.

Every 6 months (12 months in a small business) a casual employee will be able to self-assess their employment relationship by virtue of the above criteria and choose to, if they believe they no longer fit within the definition of casual, notify their employer of a conversion request.

• New Conversion Stream

The new right to request conversion completely replaces the previous conversion streams including the requirement for employers to offer casual employees conversion to full-time or part-time at 12 months.

Employees, if they believe they no longer meet the definition of casual above can request conversion under this new right if they meet the criteria outlined in the below guidance material.
Employers must respond within 21 days alerting their employee to their acceptance or refusal of the conversion.

• Casual Employment Information Statement Requirements

To ensure employees are reminded of their rights and ability to change to permanent work, employers will also be required to provide the Casual Employment Information Statement to casual employees:

• for small business employers – after 12 months of employment,
• for other employers – after six and 12 months of employment, and then after every 12 months of employment.

The AADA has provided the below guidance material to assist members.

You can also view the Government’s fact sheet of these amendments here.

The information provided in this Bulletin is general and is intended to assist employers in understanding these changes.

The AADA encourages members to seek their own specialist advice regarding these changes.

AADA GUIDANCE MATERIAL

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Today the Albanese Labor Government announced an expansion of the New Energy Apprenticeships Program which provides incentives to encourage more people into sectors that are playing a critical role in transitioning Australia to a net zero economy.

From 1 June 2024, the program will be broadened to assist more apprentices and trainees to upskill in sectors with exposure to clean energy – such as the automotive sector. This is through the removal of a requirement that an apprentice’s work be solely dedicated to clean energy, whilst retaining a clean energy skilling purpose for the apprenticeship.

The New Energy Apprenticeships Program gives apprentices up to $10,000 in support over the duration of their apprenticeship, helping to offset cost-of-living challenges that apprentices face, especially during their first two years.

The New Energy Apprenticeships Program covers 40 different occupations, encouraging more apprentices to build skills relevant for the net zero transition.

The changes to this scheme removed a requirement that an apprentice’s work be solely dedicated to clean energy and is welcome recognition that along with servicing and repairing new technologies such as EVs and hybrids, automotive technicians will continue to provide services for traditional ICE vehicles well into the future.

For more information about New Energy Apprentices, visit www.apprenticeships.gov.au.

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New regulations in Western Australia will come into effect in June requiring Dealers to advise customers if a vehicle they are selling has been written off, with penalties coming to car Dealers who fail to disclose.

From 7 June 2024, motor vehicle Dealers in Western Australia will have to disclose to prospective buyers if a vehicle under 15-years old is a repairable write-off.

WA Dealers must use amended Motor Vehicle Dealers Act (MVDA) forms which include the addition of the Written Off Vehicle Register (WOVR) status of used vehicles on the Notice of Particulars.

Failure to make this disclosure may result in a $2,000 penalty and any false or misleading statement or representation on the sale form will attract a $5,000 fine under the Motor Vehicle Dealers legislation.

The most complete method of checking in all States is to input the VIN to the PPSR inquiry website.

Dealers should make sure that Dealer Management software systems include the amended forms, and that staff are aware that used repairable write-off vehicles registered on the WOVR must be declared on Form 4 at all times.

The AADA will send Dealers copies of the new MVDA Forms when they are available from Consumer Protection. More information can be found online.

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Australia has posted an impressive used car sales result for the month of March despite the disruption in trade brought on by the Easter holidays.

Ongoing strength in new car sales has improved the supply situation on the used car market leading to more choice and improved affordability. Consumers are in a good position to shop around and negotiate a good price for a used car.

The used market for electric vehicles is gradually emerging with strong growth in the number of listings and cars sold. Sales of EVs grew by an impressive 13.1% while PHEVs grew by 8.9%. Customers in the market for a used EV have plenty of bargaining power as the number of listed vehicles is well above the number being sold.

Amid all the talk of fuel efficiency standards in recent months, this data underscores the resilience of the ute market. Utes aged 2-4 years were the only category which did not see a reduction in retained value and the likes of the Ranger, Hilux and Triton experienced significant increases in sales from the previous month.

While retained values continue to trend downwards, the cars which are holding their value the best are smaller used cars such as the Toyota Yaris, the Honda Jazz and the Mazda 2 which are all highly sought after by Australians.

The Ford Ranger remains Australia’s best-selling used car, while Australia’s love affair with Toyota is demonstrated by the fact that it makes up five of the top ten used cars sold in March.

The Automotive Insights Report shows that in March:

• 287,620 vehicles are listed for sale, a slight increase of 0.5% compared to the previous month.
• 184,054 used cars were sold in March, an increase of 2.6% from the previous month.
• The used market for electric vehicles is slowly emerging with strong growth in the number of listings and cars sold.
• Sales of EVs grew by an impressive 13.1% while PHEVs grew by 8.9%.
• Average time to sell a used car is 44.2 days, the the lowest it has been for 12 months.
• Retained values continue their gradual decline with passenger vehicles holding their value best for vehicles in the 2-4 year age bracket (85.1%) while utes perform best for the older 5-7 year category (71.3%).
• The Ford Ranger remains Australia’s best-selling used car, followed by the Toyota Hilux.

Dealers seeking more granular and local data can contact AutoGrab directly for a tailored solution.

If you are a Dealer of a contributing brand and would like access to the monthly report please email Communications Manager Ashleigh Sykes on asykes@aada.asn.au.

The AADA is pleased to release the ‘Electric Vehicle Charging Infrastructure Guidance Report’, undertaken by energy and climate consultants Energetics, to examine the impacts of the transition to low emissions (LEVs) and electric vehicles (EVs) for Australian automotive dealerships. The report was commissioned by the AADA to assist members in understanding the level of investment that will be required of dealerships to upgrade their facilities to support the sale, service and charging of LEVs and EVs.

Energetics’ analysis found that the investment needed in infrastructure is estimated to exceed $1 billion for franchised new car Dealers in Australia. The capital investment is expected to range from $130,000 for a typical regional Dealer to $580,000 for a typical rural Dealer.

The report examines key cost implications for Dealers based on their location and details the expected number of, and different types of EV chargers needed to support the future fleet makeup. These inputs are then used to determine the upstream electrical infrastructure upgrades required and the capital and operational investment in charging and enabling infrastructure for Dealers.

The issue of EV charging for dealerships and what role automotive Dealers can play in educating customers on charging options at the point of EV purchase has become a prominent issue recently, particularly as the Federal and state governments look to accelerate the EV transition through different policy mechanisms.

To ensure that Dealers are well placed to access the benefits of this transition, dealerships will not only need to invest in significant modifications to support the sale, service and repair of EVs but will also need strategies to identify and capture a range of opportunities to add to revenue streams. This can include the addition of sales and servicing to include charging, retailing and the on-selling of charging infrastructure and installation for customers’ homes.

The AADA is seeking to take a proactive approach in engaging with governments, network providers and regulatory bodies to further assist Dealers in this area.

We will be providing members with a range of resources including, guidance for engaging with your relevant network provider, advice to assist in the consideration of the upgrading of premises’ connections to the electricity network to support EV charging, and tools to help EV salespeople in the customer decision-making about the home EV charging arrangement they establish.

In the meantime, you can find the full Electric Vehicle Charging Infrastructure Guidance Report below.

VIEW FULL REPORT

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AADA is pleased to release the 2024 edition of the Dealernomics Automotive Statistics booklet. Dealernomics Automotive Statistics 2024 is a valuable resource which provides insights into the latest trends in the automotive industry, summarising some of the most relevant and interesting data gathered from various sources.

This year’s extended publication includes input from some of our expert industry partners to bring you an even more comprehensive guide into the state of the industry including:

• various statistics on new and used vehicle sales,
• Australia’s in-service fleet,
• the economic contribution of dealerships,
• the sales performance of each Dealer network,
• taxation in the automotive industry,
• motor industry benchmarking figures, and
• updated results from our consumer sentiment survey on EVs.

To access your essential summary of the past year in the automotive industry, download the Dealernomics Automotive Statistics 2024 booklet below.

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If you are a member and would like hard copies of the booklet, please contact the below AADA secretariat member and we’d be more than happy to send some out.

Communications Manager: Ashleigh Sykes – asykes@aada.asn.au

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In the lead up to Anzac Day next month, AADA has received correspondence from the Department of Veterans’ Affairs (DVA) in relation to the use of the word ‘Anzac’.

The correspondence requested that AADA make members aware of Protection of Word ‘Anzac’ Regulations 1921 (Cth) (the Regulations), which outline how, where and when the word ‘Anzac’ may be used. It is important to note that the use of the word ‘Anzac’ is not permitted in an official or corporate manner without permission from DVA. For example, this includes selling or producing goods, fundraising, exhibitions, games and sporting events.

Members are encouraged to familiarise themselves with the Regulations which are available on the DVA website, as is the simple application form for permission to use the word ‘Anzac’. There is no cost to apply for a permit.

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February used car sales figures have been released today in the Automotive Insights Report (AIR). The figures released by AADA and AutoGrab show that the number of used vehicles listed for sale has increased but the number of used cars sold have dropped.

A strong start to 2024 new car deliveries is flowing down into the used car market, with a slight rise of 1.3 per cent in the number of vehicles listed for sale in the month. While listings increased, sales of used cars dropped by 1.2 per cent from the previous month.

Amid all the discussion on fuel efficiency standards, the number of EVs listed for sale is almost four times the number which sold in February, indicating a mismatch between demand and supply of used EVs. Petrol and diesel cars accounted for 95 per cent of used cars sold, with hybrid sales increasing by 4.6 per cent this month.

Although February saw a drop in average retained values, for vehicles aged 2-4 years, there are some cars that continue to secure good retained values with 18 of the top 20 models listed reclaiming their positions from January.

The Automotive Insights Report shows that in February:

• Across Australia 286,329 vehicles were listed for sale and in that period 179,448 were sold.
• The data shows that the overwhelming majority of used cars being bought and sold have petrol or diesel engines, occupying a 95 per cent market share.
• The time it takes to sell a used car has gradually come down to 44 days in February after peaking in November at 52 days.
• On average, retained values saw a month on month decrease.
• Some popular used car models aged 2-4 years old continue to report a strong return in terms of their retained values with 18 of the top 20 models listed making a repeat appearance from January.
• The top 10 selling cars in the used market remained very similar to the previous month with 9 of the top 10 makes and models retaining their spot in the list. It closely reflects preferences in the new car market, with the Ford Ranger taking out top spot ahead of the Toyota Hilux.

Dealers seeking more granular and local data can contact AutoGrab directly for a tailored solution.

If you are a Dealer of a contributing brand and would like access to the monthly report please email Communications Manager Ashleigh Sykes on asykes@aada.asn.au.

The AADA have provided a submission to the Government’s consultation on the proposed New Vehicle Efficiency Standard (NVES). The submission has highlighted the limitations of the current proposal and suggested changes to the policy.

The submission used input from members, along with research and reports from industry partners to inform our position. New car Dealers are generally supportive of the introduction of a NVES for light vehicles, however it needs to be one that is fit for purpose, delivering environmental outcomes, while allowing an appropriate transition for consumers and automotive businesses.

The AADA remains firm on the position that the preferred option put forward by the Government goes too far too fast and will have serious implications for consumers on vehicle choice and affordability.

Some of the key recommendations in the submission include:

• Adding SUVs and four-wheel drives to the Light Commercial Vehicle Category,
• Allowing the expanded Light Commercial Vehicle category seven years to meet their target,
• Reducing the proposed penalties in the early years of the scheme,
• Developing a series of incentives to stimulate consumer demand for low emissions vehicles, and
• Including flexibilities such as super credits and off-cycle credits into the NVES.

We will continue to participate in consultation with the Government on this issue.

View the AADA submission here.

If you would like the learn more about the NVES and how it is poised to impact the industry in Australia, we will be hosting a webinar this week covering the topic. The Government is seeking to catch up to the United States and we will hear from Barbara Kiss, a distinguished former automotive regulatory executive who helped design and implement a number of fuel efficiency policies in the US.

Date: Friday 8 March 2024

Time: 11:00am (AEDT)

Presenters: Featuring Barbara Kiss alongside AADA CEO James Voortman and MTAA CEO Matt
Hobbs.

Register:

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