3rd October, 2018 · CEO Message

CEO Message No. 37

2 minutes to read

The AADA Convention on the Gold Coast has come and gone, leaving those who attended with much food for thought. We are constantly told that our industry is on the verge of profound change, brought on by forces such as automation, electrification, connectivity and sharing. It was thus fitting that the theme for this year’s convention was “Developing Prosperity in the age of Automotive Disruption”.

Heraclitus by Johannes Moreelse
Greek philosopher c. 535 Рc. 475 BC

The Greek philosopher Heraclitus famously said that “change is the only constant in life”. Make no mistake about it change is coming to our industry, but a number of the speakers at our convention were clear in their belief that change is likely to happen both more slowly than feared, and with less significant impacts than is widely claimed today.

The demise of the franchised new car Dealer has been forecast many times before, but the system persists and has proven itself able to adapt to change, largely due to the entrepreneurial spirit and ingenuity which are core elements of Dealers.

In business, these qualities are essential. Equally essential for a new car Dealer is a respectful and mutually beneficial partnership with their OEM. Sadly, for many of our members such a partnership is lacking. This is why the AADA, in close collaboration with the AMDC, has identified the pursuit of an Automotive Code of Conduct as our number one priority.

Over the past 12 months we have worked tirelessly to advocate for such a code and in recent weeks some of this work is starting to pay off. At the Convention, Shadow Assistant Treasurer, Dr Andrew Leigh, announced the Labor Party’s support for an automotive code. Shortly afterwards we received public support from the Small Business and Family Enterprise Ombudsman and the Franchising Council of Australia.

These are all very welcome endorsements, but much work remains. Most importantly, we need to secure a commitment from the current Government. The AADA is an apolitical organisation and our interest has and will always be trying our very best to reach a bi-partisan commitment to this important issue.

To date the Government has responded to our advocacy by instructing the Industry Department to investigate the issues in automotive franchising. Furthermore, a Parliamentary Inquiry into the Franchising Code is due to make recommendations to the Government in early December.

We are hopeful that this momentum will eventually result in the establishment of an Automotive Code of Conduct being official policy for both of Australia’s major parties and that this in turn will result in change for the better.