Report: Consumer laws failing Aussie car buyers and dealers

The industry body representing car dealers in Australia is calling for major changes to Australia’s consumer law framework. An independent review uncovered systematic failures, reportedly leaving Aussie car buyers stranded and new car dealers unable to help. Frosty owners are now taking to private Facebook groups to vent their frustrations, some of whom have been left cold in more ways than one.

According to a report commissioned by the Australian Automotive Dealer Association (AADA), car buyers and franchised new car dealers are copping delays, cost increases and poor consumer outcomes, all caused by consumer law shortcomings.

It revealed delays of six to eight weeks in claim resolution for vehicle defects for consumers and said state and territory tribunal hearings can blow out to 12-18 months.

It also found that some manufacturers are denying reimbursement claims and failing to effectively resolve disputes.

In short, buyers are left stranded with faulty or unwanted vehicles while dealers are unable to help.

The latest review cites a 2017 ACCC market study which found vehicle manufacturers “needed to overhaul the way they were handling consumer guarantee claims” and “review their commercial arrangements with dealers”.

Almost a decade on, the issue has become even worse as more brands have entered the Aussie market.

“This review clearly shows that Australia’s consumer laws are not delivering the outcomes that consumers and new car dealers deserve,”?said AADA CEO James Voortman.

“The evidence presented in this report indicates that some international manufacturers are either failing to engage with, or are not adequately responding to, Australia’s consumer law processes.

“Ambiguous definitions and unclear procedures are creating unnecessary costs for businesses, placing additional pressure on tribunals and, most importantly, leaving motorists without access to their vehicle for extended periods,” he said.

Several examples of such issues have been raised by dealers from “overseas brands new to Australia and ‘inexperienced’ with local consumer protection laws”, according to the ABC, including customers waiting months for repairs while manufacturers delayed authorising warranty work, sourcing parts or approving replacement vehicles.

Concerns around delays securing replacement EV batteries, which can only be shipped by sea, were also raised. According to dealers, language barriers, complex warranty approval processes and reimbursement systems mean minor claims can take several hours to complete.

A quick scour of the internet reveals a slew of complaints.

On a Facebook group dedicated to Jaecoo J5 owners in Australia, there have been at least seven separate complaints of a cabin heating failure – one owner said the dealer had the car for two weeks without any resolution to the problem.

Another J5 owner said they experienced complete loss of power with a main battery failure on a freeway. The car is reportedly now at a dealer awaiting replacement.

On a more positive note, others have noted “quick” repairs for crash damaged vehicles – one of which needed a replacement EV charge port flap, which they said cost $900.

The Chery-owned brand isn’t alone.

Another Facebook page for GAC owners in Australia uncovered concerning EV complaints, with some Aion owners reporting complete vehicle shutdown after using DC public charging stations.

In another group, the owner of a Leapmotor B10 said they were locked out after leaving the vehicle’s key card inside the cabin.

While reports of faults are many and varied, they aren’t exclusive to emerging brands, with established makers having their own dramas.

Just last month, carsales uncovered a manufacturing defect affecting thousands of Ford Ranger and Everest vehicles – one affected owner told us they were stuck for nearly a week awaiting a replacement part.

Some brands have already committed to doing better – one of them is BYD.

Last year, BYD’s local chief operating officer, Stephen Collins admitted the company needed to improve its aftersales and customer support experience.

As far as Voortman from AADA is concerned, multinational manufacturers must take greater responsibility for their products, and “be active participants in resolving consumer disputes.”

The AADA is now calling on the federal government to mandate earlier manufacturer participation in vehicle-related consumer claims, undertake a targeted review of key legislative definitions, and conduct a broader assessment of how the Australian Consumer Law operates in the new vehicle market.

Related: VFACTS March: EV sales boom as petrol prices rise

Related: BYD Sealion 7 nearly topples Toyota HiLux in record month

Related: ACCC fines Tesla for breaching consumer law

Join the conversation at our Facebook page
Or email us at editor@carsales.com.au