Parallel importer hails government reversal

Australian consumers will benefit greatly from lower prices and a wider diversity of choice in new cars after 2018, says the director of Adelaide-based Auto Services Group, Kristian Appelt.

Mr Appelt's opinion is contingent on federal parliament passing legislation proposed today by federal government MP Paul Fletcher

"The changes are a significant first step in acknowledging that the current protectionist policies are no longer relevant once automotive manufacturing ceases in Australia," Appelt told motoring.com.au today.

"Allowing consumers to choose from new vehicle options overseas will create significant downward pressure on the prices of models being sold locally, particularly at the top end of the market."

The government's unexpected change of heart does put the old axiom 'caveat emptor' (let the buyer beware) ahead of formalised consumer protection protocols – a point Appelt acknowledges.

"The reality is that those considering importing a new vehicle from overseas will need to do their research and decide for themselves if the benefits will outweigh the costs. There will be some wishing to save money on locally-delivered models, and there will be others keen to purchase a model that is rare or unavailable in Australia.

"For most consumers, a locally-delivered vehicle may be considered the easiest option. We don't foresee the potential market being anywhere near the numbers projected by the government, but the important point is that consumers are given the choice."

That choice means cars that have been previously unavailable to Australian consumers, such as the Subaru Forester STI Appelt mentioned in April last year when he spoke with motoring.com.au previously, will now be on the table.

The numbers of private imports projected by the government are 30,000, according to a press release issued by Fletcher, the Minister for Major Projects, Territories and Local Government. Even that figure, as relatively optimistic as Appelt suggests, would represent only around three per cent of the new-car market in Australia.

Aside from choice and potentially lower price, one of the key advantages of deregulating parallel importing is the ability to secure a high-demand car from overseas through the services of a company like Appelt's well ahead of its official launch date in Australia, he says.

"In the past, the popularity of a model overseas has often determined the delay in its release in Australia, with 'lag times' between overseas release and Australian release often stretching beyond 18 months. The proposed changes will allow Australian motoring enthusiasts access to exciting new models as soon as they are released overseas."

Much of the focus has centred around importing cars up to 12 months old and with less than 500km on the odometer – and different buyers will harbour different views as to whether these cars are 'new' or 'used'. With under 500km on the odometer, the car is new, in effect, but at up to 12 months old it would technically be a used car, like a dealer demonstrator.

Appelt also observes that the proposed changes will be a boon for buyers of older cars from left-hook countries. The current fixed-date system means that such a vehicle must be at least 27 years old to be eligible for private importation, because buyers are currently restricted from acquiring a vehicle built more recently than January 1, 1989. Under the proposed legislation, the cut-off for importation of older models will not be fixed by a date; instead the buyers will be able to acquire vehicles overseas provided they're more than 25 years old.

"The introduction of a rolling 25-year rule for classic cars is a far more common-sense approach than applying an arbitrary cut-off date, as is currently the case. With a range of new classic models becoming available from the US, our hope is that the federal government will sit down with state ministers and harmonise the registration of left-hand drive vehicles across Australia, or some enthusiasts may find they need to wait a few years before they can drive their freshly-imported vehicle on the street."

The proposed changes are expected to help importers like Appelt, since the Motor Vehicle Standards Act will be amended to ease restrictions on the number of vehicles a Registered Automotive Workshop can import.

Although currently there is some disquiet being expressed by the Federal Chamber of Automotive Industries and its members, the proposed changes to the act may reduce the pressure on some manufacturers to import a specific vehicle expected to sell in small numbers only.

In the case of a company like Honda, buyers can opt to import the current Civic Type R (pictured at its line-off ceremony in Swindon, UK), despite being ruled out for Australia because the current model has arrived too late in the life of the current model Civic to go on sale here long before the next generation of Civic is due to arrive.

The government's announcement today has also been welcomed by the Australian Automobile Association (AAA).

"This is a big win for consumers and a decision that will open up choice, help put downward pressure on prices, and increase competition within the Australian car market," said AAA Chief Executive Michael Bradley, as quoted in a press release.

"It will also produce environmental and safety benefits because it will encourage faster renewal of Australia's vehicle fleet. Australia's private car fleet has an average age of 10 years, which is old by global standards. The fact Australians often pay over the odds for new cars plays no small part in this.

"We think this is a prudent first step, requiring that the imported cars be effectively compliant with Australian safety standards, and have less than 500 kilometres on the clock.

"We also think it's time these import restrictions were lifted because from 2018 there will be no Australian car manufacturing industry to protect."

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