The Federal Government green lights grey imports: New cars set to get even cheaper. And, in related news, corporate barrow-pushing bullshitters see red over green light for grey...
The Federal Government has agreed to relax Australia’s to-date draconian restrictions on independent imports of new cars. Grey imports. Parallel imports. (Tomaeto/tomato - same thing.) From 2018 you will be allowed to import a new - or near-new - car into Australia from Japan or the United Kingdom, as long as it’s under 12 months old and has fewer than 500 kilometres on the clock. And it’s about time they opened this particular door.
The changes were announced this week by Major Projects Minister Paul Fletcher - it will also be easier to import classics and collectibles provided they’re at least 25 years old.
Green lighting parallel imports is great news for Australian new car buyers because it will exert pressure on dealers and importers to sharpen their pencils and cut the cost of new cars, just to compete - thereby removing the 'Australia Tax' - that inexplicable financial premium that makes new cars more expensive here. Sometimes almost twice the price.
Organisations telling you this is a bad idea are bullshitting you on an epic scale to conceal a vested interest - usually a hidden agenda to protect their profit - because this is unreservedly good news for ordinary new car buyers. More competition will drop the price.
The car industry’s grubby little lobby group in Canberra has been on the back foot over this for ever. But with no local car industry to protect any more, they’ve had to rely on a host of apparently made-up reasons that just don’t pass the pub test. They seem to be really struggling to sell their objections.
The Federal Chamber of Automotive Industries - the lobby group (they refer to it as the ‘peak body representing the car industry') - uses what in my view is an especially dodgy form of thought closely related to, but not quite, logic. Their spokesperson, Tony Weber, said (click to enlarge):
Me? I would have hired in Donald Trump. He could have just built a car-proof wall around Australia - except for vested interest groups. The fact is, the car industry lobbied very hard against Australian Consumer Law. They issued an 18-page submission (right) to the Commonwealth Consumer Affairs Advisory Council in September 2009 claiming the status quo of under-done then-existing consumer protection laws was not just adequate, but in fact excellent, using the same neat blend of almost, but not-quite logic.
Learn more about why we still desperately need lemon laws >>
While we're at it, you better avoid these lemon cars >>
More on which cars to buy - and avoid >>
On recalls, repairs and servicing, mentioned by Me Weber, above: this is either just admin, or business as usual. For example: Say Car Company A issues a recall. They do it by VIN code, and the edict comes from head office, overseas. If your VIN code is affected and you’re here in Australia, they can ship the parts to your local dealer, and the dealer can invoice the parent company for the work. How hard is it?
Are we seriously saying that, in the information age, where global shipping of anything is just a mouse click away, where ISIS can behead you and stream it into every infidel loungeroom on earth, that having a global VIN code database is too hard? Parent car companies will need to facilitate recalls - because if your car has a safety defect, and if it injures you, I’m pretty sure that them saying ‘we don’t have admin practices in place to chase this up’ is probably not a defence that’s able to fly in court.
For the record, also on the FCA position quoted above (see excerpt, right), these businesses are also not altruistically investing in Australia, as the car industry disingenuously alleges, they’re overwhelmingly investing in their own profitability. Workshops and servicing are a valuable business unit in a dealership, not some pstriotic investment in the nation. They’re not fighting homelessness or preventing violence against women. They’re making money - which is absolutely fine, except when you sex it up like they’re curing cancer for Australia.
And let’s not forget the car industry is global - so a Mazda from Japan or a Mercedes-Benz from the UK is fundamentally identical to the ones sold here. If you can get it cheaper in one of those other countries, and land it here cheaper than you can buy it here conventionally … well, that just proves there’s a monumental rip-off at play in the existing Australian new car delivery architecture. Knock me down with a feather. That’s actual logic.
Mercedes-Benz, that company’s been quite outspoken on this issue too - and so has Porsche - because they’ve got the most to lose, potentially.
Mercedes-Benz's spokesperson, David McCarthy in the … distinctive ... shirt and tie (right) has chosen to poke Mercedes-Benz’s head out of the trench on this issue, many times.
Mercedes-Benz has had a lot to say about parallel imports for Australia. When this issue was seriously floated by the Federal Government, over 12 months ago, the Company's Australian head, Horst von Sanden, had something of a spray on it at the time. Reading in between the lines at the time, I formed the view Mercedes-Benz Australia had already calculated just how much money the company stood to lose, should the proposal go ahead.
Full report on that here: Grey imports, 2015-style >>
More on the FCAI's and Mercedes-Benz's absurd position on alloy wheels >>
In respect of the ministerial green light this week, Mr McCarthy recently told the website CarAdvice (Click to enlarge, below):
Good to know the joinery is that robust. Zero daylight. Even at midday during the summer solstice. That’s how you tell. Perhaps it also holds water, this joinery. I’m rapidly forming the view that whenever Mercedes-Benz and the Federal Chamber double-team each other in front of the media, chances are pretty high you’ll be able to fertilise the philodendrons with everything they say. This Mercedes-Benz comment: “and has for decades,” unquote, in respect of consumer protection: If memory serves, Australian consumer laws were so leaky they upgraded them on January the first, 2011. That’s not even decades in dog years.
Look at how adroitly the almost-logic is applied. If you believe what these organisations claim, you’d form the view that the profits of the businesses they represent are unimportant, or at least secondary. Instead, they’d have you believe they’re concerned mainly about you, and your protection. You come first. And isn’t that how you feel, invariably, when you interact with big business?
The statements these organisations make seem to me like nothing more than intelligence-insulting bullshit. The Federal Government is actually doing the right thing by consumers here - and I don’t find myself saying that very often. It seems to me these arsehole organisations just want to keep the profit pumped up - and the only way they can do that, now the governmental deal is done - will be to ratchet up the fear. ‘We won’t support you.” That kind of thing. If they don’t support you, with service or parts, whatever, like they’ve threatened in the past, hey, that’s just a commercial opportunity for an entrepreneurial privateer. Because the commercial world, just like nature, abhors a vacuum - especially one in an organisation’s propaganda.
Time to face facts: A big fat Benz that you might import from the UK came out of exactly the same factory that a big fat Benz you buy here in Australia came out of. The car industry is global. The support must ultimately be global. The importers are overwhelmingly wholly owned subsidiaries of the parent carmaker. These artificial price-pumping-up structures like local import operations and dealer networks here in Australia are feeling exactly the same way taxi drivers feel about Uber. They’re about to get disrupted. I dunno about you, but I’m gunna kick back, put my feet up on the desk, and enjoy watching the bullshitters tread water until they sink without a trace. Which they will. I’m John Cadogan; thanks for watching.