Archives: Dealer Bulletins

The Automotive Insight Report (AIR) for August shows softening used car sales with the exception of hybrids, which are proving popular for cost conscious buyers.

Listings of used cars increased by 4.9% to 299,147 while sales dropped by 3.6% to 206, 804.

The average days to sell have continued to decrease, reaching a new low of 42.7 over the past 12 months, indicating sellers are motivated and buyers are ready to snap up a good deal.

Used car demand has decreased in all states except South Australia and Tasmania, On the supply side, Western Australia saw a 15.1% increase to 31,015 listings, while the Australian Capital Territory and Northern Territory recorded significant supply drops of 15.4% and 14.9%, respectively.

Supply of used cars increased across all categories, with SUVs and LCVs rising the most by 6.8% and 10.2%, respectively. This surge could partially be explained by the sharper decline in retained values for these vehicles compared to passenger cars, prompting sellers to hold onto them for shorter periods.

There are some correlations to the new car market in terms of the growing popularity of hybrid vehicles, with hybrid sales increasing by 0.6% to 8,435 compared to July, while petrol (-3.7%) and diesel (-3.9%) both experienced a decline in sales.

Compared to July, the used EV market is now facing an oversupply, with sales seeing the largest drop among all fuel types, down 8.3% to 1,637. This could lead to more competitive pricing, influencing buyer preferences as disposable incomes erode.

Retained values continue to decline steadily. Small vehicles and performance vehicles in the passenger segment continue to hold their value the best, with the Toyota 86 replacing the Toyota Corolla for the top position at 98.4% in the 2-4 year old category and the Toyota Yaris maintaining the lead at 94.8% in the 5-7 year old category. In the SUV category, the Suzuki Jimny continues to dominate, holding the top spot in both the 2-4 (114.0%) and 5-7 year old (116.4%) SUV categories.

HIGHLIGHTS FROM THE AIR FOR AUGUST

• 206,804 vehicles were sold in August, a decrease of 3.6% compared to the previous month.
• Western Australia recorded the highest jump in supply of used cars, rising by 15.1% to 31, 015 whereas South Australia and the Northern Territory were the only two states where demand increased, by 0.3% and 1.8% respectively.
• 299,147 used cars were listed for sale in August, an increase of 4.9% from the previous month.
• Sales were weakest in ACT (-29.1%) and Northern Territory (- 37.4%), reflecting a significant drop in sales compared to last month.
• Average time to sell a used car is 42.7 days, the lowest it has been over the past 12 months.
• Retained values continue their gradual decline with passenger vehicles holding their value best in the 2-4 year age bracket (81.1%) as well as for the older 5-7 year category (67.3%).
• 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 Policy and Communications Officer Urmika Deb on udeb@aada.asn.au.

This is to advise you of the upcoming annual general meeting of the members of the Australian Automotive Dealer Association Limited. The details of this meeting are as follows:

• Date: Tuesday 15 October 2024
• Time: 2:00pm (AEDT)
• Place: Video conference (details provided upon registration)

REGISTER FOR AADA AGM

At the meeting, members will be asked to consider and vote to:

• accept the annual report
• accept the director’s report
• accept the auditor’s report
• accept the annual financial statements
• accept the outcome of the election of directors

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Notice of 2024 AADA Board Elections and Nominations

The new AADA was established in 2014 by its Founding Members.

In 2024, the representative positions up for election in your state are:

• Queensland: Nick Pappas – Standing for re-election
• Australian Capital Territory: Peter Axiom – Standing for re-election
• Northern Territory: David Hayes – Standing for re-election
• Victoria: Nominations received in the notice period which concluded on 06/09/2024. The successful candidate will be announced at the 2024 AGM.
• Western Australia: Nominations received in the notice period which concluded on 06/09/2024. The successful candidate will be announced at the 2024 AGM.

Suitably qualified and experienced motor vehicle Dealers are invited to stand and contest the election for Queensland, Northern Territory and the Australian Capital Territory in the forthcoming elections. The closing date for nominations is COB 1 October 2024.

If no other candidate contests the election in the States listed then those who have nominated for re-election above or any single nominee will be duly elected and serve a three year term.

Parties interested should confirm their desire to stand for election in writing to the AADA Returning Officer, Vinesh George – vinesh@vsgeorge.com.au

All candidates must comply with the AADA Code of Practice regarding Elections, which will be provided upon a candidate standing.

AADA Directors serve in an entirely voluntary capacity and donate their time and experience to give back to the industry. More details of the role and likely time required to fulfil the role can be provided by the AADA.

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Please be aware that the Queensland Government’s Zero Emission Vehicle Rebate Scheme will close at 11:59pm tonight, Monday 2 September 2024.

Initially planned to run for three years, the scheme has proven popular, finishing in just over two years with the Queensland Government announcing on 31 August 2024 that the program will close as the funding has been exhausted.

The scheme has been in effect since 1 July 2022, and on 1 July 2023, the Queensland Government increased the rebate from $3,000 to $6,000 for eligible individuals who met a household income threshold, and increased the vehicle threshold from $58,000 to $68,000 (inclusive of GST).

The AADA had confirmed with the Queensland Rural and Industry Development Authority that consumers are able to receive the rebate if they have purchased a vehicle and submitted an application by the 11:59pm deadline tonight.

More information can be found in the media statement.

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Queensland introduces 3-month vehicle registrations for Dealers

Queensland Dealers have received the good news that the Queensland Department of Transport will now accept 3-month registrations and renewals for Dealer stock and demonstrators.

The Queensland Department of Transport and Main Roads advise that:

“This change recognises that some motor Dealers cannot access direct debit for vehicle registration. It is also acknowledged that motor Dealers have a need for flexibility due to the varied nature of the industry with high and low sales periods. This also brings consistency with other transport-specific industries, such as freight, taxis and booked hire vehicles.”

How can motor Dealers access 3-month registration terms?

 3-month terms can be selected by motor Dealers on application forms provided to a TMR Customer Service Centre and by motor Dealers enrolled in the Rego Easy Scheme.

Queensland Dealers have been active in the pursuit of this change and through the strong efforts of the MTAQ have achieved a very good result for Dealers. For more information, you can refer to the FAQs on the Queensland Department of Transport and Main Roads website.

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The Automotive Insights Report for the month of July indicates that the market for used cars is tightening, with rising sales and falling listings leading to a reduced gap between demand and supply.

Listings of used cars experienced a reduction of 5.8% down to 285,133, while sales observed a significant jump of 11.6% to 214,588.

The average days to sell has remained relatively steady at 43.6 days, marginally lower than June and the lowest in the past 12 months.

Tasmania was the only state to experience a slight increase in used cars listed for sale, while the Northern Territory stands out as the only state observing slower demand, with a significant decline of 15.6% in sales. However, this reduction in supply should be considered in the context of the trend which saw increases in supply experienced during the first half of the year.

A notable trend that has emerged since the start of this year is the greater proportion of cars being listed privately compared to Dealer listings. Private listings reached a high of 69.1% this month. However, dealer sales have remained steady at around 40% which suggests Dealers are pricing their stock to sell.

Petrol and diesel cars accounted for 95% of used cars sold, with hybrid sales increasing by 12.3% this month. Meanwhile, the supply of EVs saw the most significant decline, down 16.1% even as demand increased by 12.2%.

Retained values remain on a downward trajectory. Small passenger vehicles have once again demonstrated the strongest value retention, with the Toyota Corolla and Toyota Yaris being at the top with 97.6% for the 2-4 year old category and 96.7% for the 5-7 year old category, respectively. The Suzuki Jimny continues to lead in value retention within the SUV segment, topping both the 2-4 year old category (115.6%) and the 5-7 year old category (115.8%).

HIGHLIGHTS FROM THE AIR FOR JULY

• 214,588 vehicles were sold, an increase of 11.6% compared to the previous month.
• Tasmania was the only state to experience an increase in the supply of used cars, rising by 0.3%, while the Northern Territory was the only state to see a decline in demand, falling by 15.6%.
• 285,133 used cars were listed for sale in July, a drop of 5.8% from the previous month.
• Sales in Victoria rebounded to take the top position (14.1%), while ACT (+1.4%) and NT (-15.6%) were weakest in terms of sales.
• Average time to sell a used car is 43.6 days, the lowest it has been over the past 12 months.
• Retained values continue their gradual decline with passenger vehicles holding their value best in the 2-4 year age bracket (82.1%) as well as for the older 5-7 year category (68.1%).
• 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 Policy and Communications Officer Urmika Deb on udeb@aada.asn.au.

The Automotive Insights Report data for June shows a growing oversupply of used cars in Australia as the gap widens between cars listed for sale and cars sold at the end of the financial year.

There were 192,266 used cars sold in June observing a marginal growth rate of 0.3% compared to May, while vehicles listed for sale also increased by 2.1% to 302,848.

This increase in supply has seen used vehicle values decrease across the board, with buyers benefiting from the more affordable price points. However, this has not translated to a surge in sales, which indicates the oversupply could be attributed to softer economic conditions and supported by the drop in new car sales in June.

Western Australia was the only state observing a notable drop of 13% in used car listings coupled with a 6.1% increase in sales, indicating a tighter supply situation in the West compared to the east coast.

While utes were the only segment to experience a decline in sales in June, they continue to remain a popular choice among buyers, making up three of the four top selling used vehicles.

Retained values continue to trend downwards, but the cars which are holding their value best continue to be small vehicles in the passenger segment.  The Toyota Corolla outperformed others in the 2-4 year old (99.8%) and the Toyota Yaris in the 5-7 year old (99.0%) categories. In the SUV segment, the Suzuki Jimny is the frontrunner, holding its value at an extraordinary 116.9% in the 2-4 year old category.

Highlights from the AIR for June were:

• 302,848 vehicles are listed for sale, an increase of 2.1% compared to the previous month.
• Listings experienced the highest increase in the ACT (12.5%), the Northern Territory (9.7%) and Queensland (7.5%). Western Australia was an outlier with a 12.9% reduction in listings.
• 192,266 used cars were sold in June, an increase of 0.3% from the previous month.
• Sales were strongest in the NT (12.4%) and weakest in Victoria (-4.6%).
• Average time to sell a used car is 43.8 days, the lowest it has been over the past 12 months.
• Retained values continue their gradual decline with passenger vehicles holding their value best in the 2-4 year age bracket (83.3%) as well as for the older 5-7 year category (69.1%).
• 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 Policy and Communications Officer Urmika Deb on udeb@aada.asn.au.

In the past few years, the AADA has been approached by several members operating under an agency model, questioning their obligations as Agents under the Australian Consumer Law (ACL).

Under the traditional Dealer franchise model, the Dealer is treated as a “supplier” under the ACL and is responsible for honouring consumer guarantees. Under an agency model, the Agent never has ownership of the vehicle. The Agent merely facilitates the sale of the vehicle between the OEM (as Principal) and the customer. As a result, doubts have emerged over whether an Agent is deemed a “supplier” under the ACL and is therefore responsible for “consumer guarantees”.

The AADA, as part of its membership of the ACCC’s Small Business Franchising Consultative Committee, asked the ACCC to provide guidance on this issue.

Today we received a notification from the ACCC which we have included below.

The AADA believes that the ACCC’s notification makes it clear that under an agency model it is the OEM, as the Principal, which has the obligation of the “supplier” in relation to honouring Consumer Guarantees under the ACL.

Please be aware that the ACCC notification makes it clear that while an Agent is not a “supplier” for the purposes of the ACL, it can still be deemed to have contravened the ACL if it has caused the loss.

Also, although not dealt with in the ACCC notification, where a dealer Agent is not an agent for the purposes of carrying out servicing of vehicles (and only for the sale of vehicles), the dealer will be deemed the “supplier” and be responsible for the consumer guarantees to the customer with respect to the servicing of the vehicle.

As always, the AADA recommends that members seek legal advice with respect to your specific circumstances.

ACCC NOTIFICATION

Dear SBFCC members & observers,

Please see below our responses to the Action Items from previous meetings:

SBFCC meeting No.18 of 3 November 2023

Action Item 1 – ACCC to provide guidance on consumer guarantee rights and responsibilities when an agent acts as an intermediary at the point of sale between the manufacturer and consumer.

ACCC response:

Consumer guarantee obligations attach to the supplier. In agency-principal arrangements, one business (the agent) acts as an intermediary between another business (the principal) and the customer. In these circumstances, title to the goods does not transfer to the agent and the principal business will be the supplier. The principal’s liability to meet the consumer guarantees, and provide remedies when consumer guarantees are not met, cannot be excluded, restricted or modified by contract.

If a problem arises with a product or service, the customer can contact either the principal business or the agent or both businesses. However, it is the principal that owes the remedy if a consumer guarantee has not been met and that must provide instructions to the agent on how to handle the claim. The principal should ensure the instructions it provides, and the processes it sets up with its agents for consumer guarantees claims handling, are in compliance with the Australian Consumer Law. 

In agency-principal arrangements, the principal business will generally be responsible for the conduct of its agents, including in relation to possible contraventions of the ACL. If an agent engages in conduct for which liability can be attributed to the principal, the agent will also likely have engaged in conduct in contravention of the ACL.

Previous ACCC court action concerning sales conduct by agents on behalf of various energy companies may serve as useful case studies. For example:

• In 2013, two energy providers under the AGL corporate group were ordered to pay $1.5 million for illegal door-to-door sales practices undertaken by their agents. The relevant agent, a marketing company used by the AGL companies called CPM Australia Pty Ltd, was also ordered to pay $200,000 for its role in the conduct.
• In 2015, EnergyAustralia Pty Ltd and its then-agent, a telemarketing firm called Bright Choice Australia Pty Ltd, were ordered to pay penalties of $1 million and $100,000 respectively for making false or misleading representations and engaging in misleading or deceptive conduct when selling electricity and gas plans to consumers.

Businesses should seek legal advice about how the ACL will apply in their specific circumstances.

We are in the process of updating the ACCC ‘Consumer Rights and Guarantees’ web page to include a summary of this information and will share the updated content with SBFCC when it is live on our website.

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The start of the new financial year brings a number of changes that Dealers should be aware of, including changes to the national minimum wage, the Australian Apprenticeship Incentive System, Luxury Car Tax rates, and stamp duty and registration.

Luxury Car Tax

Indexed each year, from 1 July 2024 the Luxury Car Tax (LCT) thresholds will increase:

• For fuel efficient vehicles $91,387
• For other vehicles $80,567

Further information about the application and calculation of LCT can be found on the ATO website.

Instant asset tax write-off for small businesses

As part of the Federal Budget, the Government committed to extending the instant asset write-off for a further 12 months until 30 June 2025. The eligible amount will be $20,000 for businesses with an aggregated annual turnover of less than $10 million – this is an extension at the same level as the 2023-24 Budget measure which has only just passed Parliament, less than a week before it is due to cease.

The requisite legislation to introduce the change for 2024-25, has been introduced to Parliament as Schedule 7 of the Treasury Laws Amendment (Responsible Buy Now Pay Later and Other Measures) Bill 2024 and has been referred to a Senate inquiry, which is due to report on Friday, 2 August 2024.

The AADA will update members as this progresses.

More information can be found on the ATO website.

Australian Apprenticeship Incentives System  

From 1 July 2024 the Australian Apprenticeship Incentive System will move to Phase 2.

Guidelines will be updated to reflect the following changes in financial support that new employers and apprentices that take up an apprenticeship from 1 July 2024 are able to claim:

• Priority Occupation Employers – Priority Hiring Incentive of up to $5000 over 1 year in two instalments of $2,000 at 6 months and $3,000 at 12 months.
• Priority Occupation Apprentices – Australian Apprenticeship Training Support Payment of up to $5000 over 2 years, paid over four instalments, with $1,750 paid at 6 months and 12 months, and $750 paid at 18 and 24 months.

A full copy of the updated Guidelines will be published on 1 July 2024.

More information can be found on the Department of Employment and Workplace Relations website.

Minimum Award wage rates

Following the decision of the Fair Work Commission in the Annual Wage Review Case, minimum award rates, including apprentice and trainee rates, will increase by 3.75% from the first full pay period starting on or after 1 July 2024.

Dealers should check relevant awards for compliance with minimum wage rates.

More information can be found on the Fair Work website.

Changes to motor vehicle stamp duty rates and thresholds

• Victoria

The threshold for the second-tier stamp duty rate in Victoria has increased from $76,950 to $80,567, in line with the Federal LCT indexation increase.

 From 1 July 2024, the rate of $10.40 per $200 applies to vehicles with a market value over $80,567.

More information can be found on the State Revenue Office website.

• ACT

From 1 July 2024, ACT vehicle registration fees will gradually transition from the current weight-based vehicle registration system to an emissions-based system for most light vehicles.

This means lower registration fees for lower-emissions vehicles, including:

• zero-emission vehicles (ZEVs)
• plug-in hybrid vehicles (PHEVs)
• hybrid electric vehicles (HEVs)
• low-emission petrol and diesel vehicles.

Also, depending on:

• the type of vehicle purchased
• when the vehicle was purchased or acquired
• where the vehicle is garaged.

The vehicle may be eligible for 2 years of free registration, a registration discount and/or a motor vehicle duty exemption.

For questions regarding vehicle registration, Access Canberra can be contacted on 6207 7002 or visit the Access Canberra website.

• All other states and territories remain unchanged.

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The Automotive Insights Report data for May shows the number of used cars for sale in Australia continuing to increase, with listings growing in every state and territory, putting downward pressure on prices and driving an increase in sales.

There were 191,625 used cars sold in May, representing a 4.4% increase on the previous month while vehicles listed for sale also increased by 7.2% to 296,542, reversing the trend of declining listings this year.

The used market for hybrids and electric vehicles saw strong demand for the fourth consecutive month, with EVs (8%), hybrids (6.6% growth) and PHEVs (16.6% growth) all continuing the gradual demand growth trend. However, May saw a 7.3% decrease in EV listings, which is not surprising given the significant mismatch between EV supply and demand.

The average time to sell a used car has remained around the 45-day mark (45.5 days for May) for the past four months, significantly down from the 12-month high of 52 days in late 2023.

While sales volumes continue to underscore Australia’s love for utes, passenger vehicles continue their dominance in retained values with the 2-4  year category at (84.1%) as well as the older 5-7 year category at (69.8%).

Across the board, retained values continue to trend downwards and the cars that are holding their value the best are smaller used cars such as the Mitsubishi Mirage, Toyota Yaris and Honda Jazz.

The Ford Ranger remains Australia’s best-selling used car, while Toyota continues its reign as one of the most in-demand used car brands, making up five of the top ten used cars sold in May.

Highlights from the AIR for May were:

• 296,542 vehicles are listed for sale, an increase of 7.2% compared to the previous month.
• Listings grew in every state and territory with South Australia experiencing the highest increase with 8.5% and Tasmania being the lowest at 2.0%%.
• 191,625 used cars were sold in May, an increase of 4.4% from the previous month.
• Sales grew in every state and territory with Queensland and the ACT experiencing the biggest monthly increase in sales of 7.3%.
• Petrol and Diesel vehicles dominate the used car market, but there has been strong growth in lower emissions vehicles, such as hybrids, EVs and PHEVs.
• Average time to sell a used car is 45.5 days, an increase of over a day from the previous month.
• Retained values continue their gradual decline with passenger vehicles holding their value best in the 2-4 year age bracket (84.1%) as well as for the older 5-7 year category (69.8%).
• 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 Policy and Communications Officer Urmika Deb on udeb@aada.asn.au.

Commencing 1 July 2024, the ATO have announced the LCT thresholds for the financial year the car was imported, acquired or sold.

If you import or sell a car with a GST-inclusive value above these LCT thresholds, you must pay LCT except in certain circumstances. In general, the LCT value of a car includes the value of any parts, accessories or attachments you supplied, or imported, at the same time as the car.

LCT thresholds
Financial year	Fuel efficient vehicles	Other vehicles
2024–25	$91,387	$80,567
2023–24	$89,332	$76,950

The indexation factor for the 2024–25 financial year is:

• fuel-efficient vehicles – 1.023
• other vehicles – 1.047

A fuel efficient car is defined as having fuel consumption that does not exceed 7 litres per 100 kilometres as a combined rating under the vehicle standards in force under section 12 of the Road Vehicle Standards Act 2018.

Further information about the application and calculation of LCT can be found on the ATO website.

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