Category: Industry News

With the end of the financial year upon us, BDO’s Automotive team have prepared a checklist of key tax planning initiatives for you and your dealership to consider.

BDO’S 2019 Automotive Tax Planning report covers a range of traditional motor industry tax considerations such as vehicle valuations, as well as broader tax matters such as franking credits, superannuation and depreciation deductions.

This update may also prompt you to think about your dealership’s company tax rate, particularly for entities that fit the base rate entity definition (aggregated annual turnover of less than $50 million) and are subject to a company tax rate of 27.5% for the 2019 financial year.

The AADA has assessed VFACTs for February YTD data for the first months of the calendar year. There has been a 8.4 per cent decrease for the month compared to February last year.

A list of the top 10 volume brands ranked by +/- per cent to February 2018 can be found below.

February YTD 2019 Top Vol Brands
Ranked by per cent Improvement vs February 2018
	February			+/- Vol. & %
Total Market	2019	2018		VOL.	%
Mitsubishi	15,164	12,405		2,759	22.2%
Kia	9,507	9,195		312	3.4%
Toyota	32,320	33,587		-1,267	-3.8%
Mazda	18,725	20,026		-1,301	-6.5%
Volkswagen	7,684	8,650		-966	-11.2%
Ford	10,099	11,704		-1,605	-13.7%
Hyundai	12,634	15,125		-2,491	-16.5%
Honda	7,907	9,543		-1,636	-17.1%
Nissan	7,726	9,570		-1,844	-19.3%
Holden	7,992	10,408		-2,416	-23.2%
Total	169,096	184,550		-15,454	-8.4%

Significant Consequences for the Automotive Industry

On 4 February 2019, the Government released the final report of the Royal Commission in the Banking, Superannuation and Financial Services Industry (Report). In the Report, Commissioner Kenneth Hayne made 76 recommendations, a number of which will have significant consequences for participants in the automotive industry as new laws and regulations are enacted in the months ahead. 

An article written by Shaun Cartoon, Partner, Andrew Galvin, Partner and Evan Stents, Partner, HWL Ebsworth Lawyers, examines three recommendations in the Report that are of particular relevance to car dealers. These inlcude:

1. Removing the ‘point-of-sale’ exemption of retailer dealers from the operation of the NCCP Act
2. A deferred sales model should be established for the sale of add-on insurance
3. Caps on commissions

Read the article here.

The AADA has assessed VFACTs for January YTD data for the first month of the calendar year. There has been a 7.4 per cent decrease for the month compared to January last year.

A list of the top 10 volume brands ranked by +/- per cent to January 2018 can be found below.

January YTD 2019 Top Vol Brands
Ranked by per cent Improvement vs January 2018
	December			+/- Vol. & %
Total Market	2019	2018		VOL.	%
Mitsubishi	6,669	5,263		1,406	26.7%
Toyota	15,961	15,306		655	4.3%
Kia	4,651	4,531		120	2.6%
Mazda	9,490	10,113		-623	-6.2%
Honda	4,042	4,581		-539	-11.8%
Hyundai	6,205	7,124		-919	-12.9%
Subaru	3,440	4,253		-813	-19.1%
Nissan	3,803	4,707		-904	-19.2%
Ford	4,421	5,645		-1,224	-21.7%
Holden	4,167	5,719		-1,552	-27.1%
Total	81,994	88,551		-6,557	-7.4%

Diversity and Inclusion remains firmly on the agenda for a number of determined leaders in Automotive who collectively see the importance of industry change. In fact, industry leaders from medium to large sized public and private dealership groups, a national bank, a private consultancy group and one brave manufacturer, joined forces late last year following the AADA Conference, recognising the need to create dialogue and agitate action on diversity and inclusion in the Automotive industry.

International Women’s Day 2019 has been recognised by St. George Bank as a significant platform to champion the campaign #BalanceforBetter, with the bank planning a networking breakfast to share stories and promote conversations surrounding the need for balance in the Automotive Industry. Kirzsten Peart, Head of Manufacturer Alliances Auto Finance, at St. George explained, “We recognise that gender balance drives a better working world and customer experience, and we invite active engagement from men and women in the industry to be part of the solution”.

Kirzsten is one of the forces behind the newly established association and has played an integral role in the formation of the trading name currently being registered through the Department of Fair Trade. Her cohort is reconvening this month on the Gold Coast where its inception began to firm-up the Management Committee structure being modelled on diversity and inclusion.  These meetings of the minds are called Collab[oration] Days and have been a vital part in the process for clearing defining the charter of what the association wants to achieve for the Automotive Industry.

“Research and data insights are at the top of the list for our Collab Day this month and will be presented by one of the association members who has a consulting background from the industry”, states Megan McKenzie, Group HR Manager Frizelle Sunshine. She adds, “It’s so important to know and understand current statistics so that we can set targets and measure progress against these in the future, as well as identify trends in performance”. In addition, the association will commence discussions for their first event where they invite women and men from the Automotive Industry who have progressive and innovative thoughts about making commercially viable business decisions in regards to diversity and inclusion.

2019 is set to accelerate the focus on diversity and inclusion in the Automotive Industry beginning on International Women’s Day.