The peak body representing franchised new car Dealers has welcomed the Australian Small Business and Family Enterprise Ombudsman’s call for an overhaul of the dispute resolution framework.
“This year, the limitations of the court system were laid bare in the automotive industry when more than 150 terminated Holden Dealers saw no pathway for justice and settled with General Motors under duress,” said AADA CEO James Voortman.
“All of those Dealers were deterred by the prospect of a prohibitively expensive, time-consuming and mentally draining process,” he said.
“The limitations of our dispute resolution architecture was underlined by General Motors Holdens’ flat out refusal to agree to Small Business Minister Michaelia Cash’s request for them to settle this dispute via arbitration,” he said.
“There is a demonstrated power imbalance between Dealers and the large multinational car Manufacturers to which they are franchised. One of the symptoms of this power imbalance is that very few disputes go through a court process,” he said.
“Dealers all over Australia will undoubtedly support the Ombudsman’s recommendation for reforms to the current dispute resolution framework which has frankly failed them repeatedly,” said Mr Voortman.
There are more than 3,100 franchised new car dealerships all across Australia. They employ 60,000 people, including many apprentices and generate significant economic activity in every city and country town across the nation.