Parallel import changes slammed – and supported

Two industry bodies are at loggerheads over the Abbott Government's plans to ease parallel importation restrictions.

The Australian Automotive Aftermarket Association (AAAA) has gone on record backing changes to the Motor Vehicle Standards Act, but the FCAI has maintained its hardline stance, even firing off a broadside at Fairfax media for an article on the subject published late last week.

There has been no shift in positions, in other words, over the past week and a half. Parallel importers are clearly in favour of amendments to the act – although there's still some way to go in tweaking the act to sustain the industry over the next five years, it has been argued.

New-car importers – members of the FCAI (Federal Chamber of Automotive Industries) – have had their say too; and that view places the new-car industry fair and square on the other side of the argument.

Over the weekend, the AAAA issued a press release warmly welcoming the mooted reforms for the Motor Vehicle Standards Act (MVSA). According to the association, the MVSA was last revised 15 years ago, and so much new technology has entered the market since then. It's time for the MVSA to take into account that new technology, which underpins improved safety on Australian roads, argues the AAAA's Executive Director, Stuart Charity.

"The AAAA looks forward to contributing to the Regulatory Impact Statement to be released in the coming months to promote harmonisation of vehicle standards both internationally and between Australian jurisdictions," Charity was quoted saying in the press release.

"The changes to regulations relating to personal importation of vehicles are also of interest to the aftermarket. The AAAA does not believe that these proposals will open the floodgates to personal imports.

"The AAAA agrees that import restrictions should be relaxed as long as safety is the priority, and consumers are made aware of their rights with respect to warranties and understand the service requirements required for their vehicle.

"Appropriate relaxation of personal imports will assist hundreds of thousands of Australia's motoring enthusiasts. Such changes would also generate a new avenue of business for the Australian auto aftermarket as consumers service and customise their new imports," Charity concluded.

The association is the body that lobbies on behalf of aftermarket parts and service suppliers. Among its members are parts suppliers, which can include motor vehicle repairers.

The FCAI remains unapologetically opposed to the proposed changes to the MVSA. It today responded in no uncertain terms to a Fairfax article on the subject of parallel importation.

Describing the article as "simplistic analysis" the Chamber dismissed it for its failure to compare "like vehicles" of the same or similar specification available in markets abroad and in Australia. The example provided to illustrate this was the Volkswagen Golf, which the publication stated cost $34,000 in Australia, but could be purchased (variously in the article) for $23,000 and $30,000 in Tokyo. Both the alternative prices for the Golf were published in the article, which reportedly sourced the information from Deutsche Bank – a bank recently nominating Australia as the world's most expensive country.

Fairfax was not comparing apples with apples, the FCAI states, since the Japanese-market Volkswagen is trimmed to a different level of equipment than the $34,000 Aussie-delivered car.

The FCAI continued to blast the paper and its sources for "poor research" that would "mislead" consumers. Other examples supplied in the report include the BMW 328 and Mercedes-Benz ML 350 BlueTEC Diesel. All the comparative prices supplied in the article are "simply not true" the FCAI says.

Taking the example of the BMW 328i mentioned in the article, the FCAI says that this car purchased from a UK dealer for the full list price in the UK would not yield the $9000 saving cited in the art – $55,000 in the UK versus $64,000 here. In fact, the FCAI says, the 328i purchased in the UK and ordered with the same options that are fitted as standard here would be just $600 cheaper than the $64,000 BMW Australia dealers are currently charging for the same car.

During the launch of the X5 M and X6 M last week BMW Australia MD, Marc Werner, told motoring.com.au that China, of all places, was an example of the way parallel importation could create confusion for the consumer – and cost more.

"China is a perfect example," Werner said. "China at the moment is severely suffering from vehicle imports from the US, but their standards certainly do not comply with Chinese standards. If you buy an X5, for example, and import it into China, your navigation system doesn't work, your fuel quality is a different one, your radio [bands] are different.

"What the customer then has to do is take it to a BMW dealership – who is neither trained to retro-fit vehicles; nor does he have the necessary parts and components. Overall, the customer has to spend so much money in order to retro-fit these vehicles, that he would be actually better off to buy the Chinese [delivered] product.

"The same would happen here in Australia – and this is what we would like to avoid."