Archives: Dealer Bulletins

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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Join us for an exclusive Dealer briefing on the Government’s proposed New Vehicle Efficiency Standard.

Learn about the Government’s proposed new vehicle efficiency standard, and how it is poised to impact the automotive industry in Australia. 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. Barbara will join AADA CEO, James Voortman, and MTAA CEO, Matt Hobbs, to provide Dealers and other interested parties with invaluable insights from the US market along with the potential implications, challenges, and opportunities these standards will bring for Australian new car Dealers.

Date: Friday 8 March 2024
Time: 11:00am (AEDT)
Presenters: Featuring Barbara Kiss alongside AADA CEO James Voortman and MTAA CEO Matt Hobbs.

Register:

Don’t miss the chance to deep dive into the standard, and gain insights from the US market and lessons learned there. Register now to secure your spot at this essential industry briefing!

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This is a reminder bulletin following on from the initial notification of changes in October 2023, with implementation and the billing process to commence in March.

Historically, membership of the AADA has occurred through the approval of Dealer Councils and line group representative bodies that come together under the AMDC banner. Recently several new brands have arrived in Australia, some of which are experiencing rapid sales growth thanks to strong Dealer support, but they are doing so without the guidance of Dealer Councils or advisory groups, which to date, have not been formed for these networks. While many Dealers are AADA members by virtue of them being multi-franchised, they are not members for the non-participating brands they sell, and this is something the AADA Board have instructed us to address.

It is our strong belief that every franchise network should have a Dealer Council or similar body to represent their interests directly to their franchisor. For those who do not have a council, the AADA secretariat has a standing offer to assist in the establishment and operation of one and we would encourage all Dealers representing these brands to take up the offer.

In the absence of a council however, we would like to enlist Dealers of brands selling more than 1,000 units annually to join the AADA and commence financial contributions, based on a fee per car sold.

To achieve this, we will commence sending to Dealers who sell one of these brands, a request for a report of units sold over the previous three-month period. From this number, we will generate and send an invoice for the AADA membership fee, the same as that of participating brands.

Like our current membership fee arrangements, this subscription model is based on the goodwill and honesty of our members. We are hopeful that Dealers see the value in AADA membership and recognise that AADA is deserving of their full support, including for those volume brands whose Dealers receive the benefit of the AADA advocacy work but who are not currently contributing financially.

The first invoice will be issued in March 2024 for the preceding three-month period and thereafter continue at quarterly intervals.

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The January used car sales figures have been released today in the first monthly edition of the Automotive Insights Report (AIR) for 2024.

The January 2024 AIR shows that the average time taken to sell a used car decreased slightly this month with consumers starting the year off strongly.

Despite the continued tightening in cost-of-living pressures, customers increased their purchases of used cars in January with an increase of 7.3 per cent in cars sold compared to December 2023.

Petrol and diesel cars accounted for 96 per cent of used cars sold, with hybrid sales increasing by 2.7 per cent this month. The market for used EVs and PHEVs sales decreased in January, and it is predicted that the market will likely remain volatile month-to-month for some time.

The Automotive Insights Report shows that in January:

• Across Australia 282,713 vehicles were listed for sale and in that period 181,612 were sold.
• The data shows that the overwhelming majority of used cars being bought and sold have petrol or diesel engines.
• The used market for electrified power trains remains volatile with EVs and PHEVs seeing a 9.4 per cent and 4.5 per cent decrease in sales respectively from the previous month.
• The average time to sell a used car is 47.7 days which is a slight reduction from the previous month.
• Retained values held mostly steady after some recent declines and the record highs of previous years.
• Some popular used cars are worth more on average today than when they were sold new and Toyota as a manufacturer holds 10 out of the top 20 available spots for passenger and SUV models aged between two and four years.
• The list of top selling cars in the used market 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.

Yesterday the Albanese Labor Government tabled the Independent Review of the Franchising Code of Conduct in Parliament.

The review by small business expert, Dr Michael Schaper, makes 23 formal recommendations and 34 implementation suggestions for Government to consider.

The review found that the Franchising Code of Conduct is generally fit for purpose and found that Part 5 of the Code relating to new vehicle dealerships is operating as intended and not producing any unintended consequences.

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

The Review also failed to address the need for the inclusion of truck Dealers in the automotive schedule. Many of the arguments made for specific protections for automotive Dealers also apply to truck Dealers, and it is unfortunate that the review did not recommend their immediate inclusion in the Automotive provisions of the code.

The Review did recommend that reviews of the Code should be conducted in five yearly cycles in the future and the next review of the Code should consider whether Part 5 should be retained and, if so, whether it should be extended to other subsectors such as trucks, farm machinery and motorcycles.

While the Review could have gone further to protect automotive franchisees, the AADA welcomed the following recommendations:

4. Service and repair work conducted by motor vehicle dealerships should be explicitly captured by the Code.

4A. The definition of motor vehicle dealership in the Code should be amended to clarify that it includes all sales, service and repair work.

23. The Australian Government should investigate the feasibility of introducing a licensing regime to better regulate most aspects of the franchisee-franchisor relationship.

The Report also detailed the responses to the Franchisee survey which was undertaken to obtain a greater broad-based understanding of the franchisee perspective of matters investigated in the review. Encouragingly there was significant representation from motor vehicle dealerships in responding to the survey, which accounted for 173 of the 381 responses. Motor vehicle Dealer’s average franchisee satisfaction with their franchisor was rated as 6.3 and the average franchisee rating for the effectiveness of the Code was 3.9.

The AADA will continue to engage with the Government on the details of the Review and advocate the need for strong protections for local automotive businesses.

You can view the full Report here.

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