Opening the flood gates on used imported vehicles?

The Productivity Commission has recently submitted their report into the automotive industry in Australia to the Federal Government, including recommendations for the transition from a local car manufacturing industry in 2014 to a fully imported landscape beyond 2017. I specifically mentioned car manufacturing, as opposed to automotive manufacturing, because while the existing three car manufactures will exit from Australia, the current truck manufactures, barring anything out of left field, plan to stay. And unlike their car counterparts, these local truck manufactures do not receive any financial handouts from the government to subsidise their Australian manufacturing operations.

Looking beyond these local truck manufacturers, almost every truck that is sold in Australia, be it manufactured here or imported, requires considerable second stage local manufacture with the fitment of such items as bodies, cranes, tailgate loaders, turntables, guards and much more. Many of these companies are also involved in heavy vehicle trailer manufacture too. These Australian manufacturers are essential to our truck and trailer industry and I feel confident that this fact will not be overlooked by the Productivity Commission’s final report.

Of great concern to both the truck and car industries here was a comment in the preliminary Automotive Productivity Commission report, released a few months ago, that suggested restrictions on used imported vehicles be relaxed. This comment completely disregards the local truck manufacturing industry. We don’t have to look far from our shores to see the results of used vehicle, in particular used truck, imports in a sophisticated and well regulated market. Across the ditch, the New Zealand government some years ago opened up their market to allow used car and truck imports in parallel with new vehicle importation. The outcome has been significant.

Almost overnight New Zealand became the dumping ground for second hand trucks from Japan and Europe. These vehicles while looking similar to new trucks sold through original manufacture distribution channels were in many cases substantially different. In most cases these used trucks could not be supported by the existing manufactures parts and service networks, nor could the small organisations who set themselves up to import these non New Zealand specification vehicles provide satisfactory aftersales backup. In fact many were simply ignorant to the needs of their customers beyond the original sale of the used truck. While the lack of available parts and service was an issue to the owners of these imported used trucks, a much greater problem was being created, that of compliance and safety.

It was found over a period of time that the brake systems on many of these imported used trucks did not meet suitable standards of truck and trailer brake compatibility, after all New Zealand (as in Australia) has combinations that simply do not exist in the markets where these used imported vehicles were sourced from. My travels have taken me to Japan and Europe on many occasions and I have never seen a B-Double or tipper and dog combination on those roads! New regulations were developed by the New Zealand government, but the level of compliance and safety of these used imported trucks continues to lag that of new original manufacture imported trucks.

With Australian new truck sales continuing in a post GFC slump, this contributing to our truck fleet age blowing out to almost 14 years on average, our industry cannot afford to be flooded with used imported trucks. These used vehicles would only contribute to the further aging of the Australian truck park, with operators tempted to buy an older cheaper used imported truck, rather than a new one. And if the New Zealand experience is anything to go by, vehicle safety will be compromised with these used imports. All this at a time when newer and more modern vehicles are believed to be a significant factor in the lowest Australian road toll in almost 90 years.

The Truck Industry Council is looking forward to working with the Government now that the final Automotive Productivity Commission report has been completed. TIC calls on the government to very carefully consider all aspects and ramifications of opening up the trade of used vehicle imports to Australia.

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