The New Year is underway with all its promise and challenges to be revealed along the way. Whatever comes your way, I hope you will prevail and achieve positive outcomes for you personally and for your businesses. Happy New Year.
During the festive season, our corporate office kept a ‘vigil’ for any COVID-19 related happenings that may need to be communicated to members. The lockdown of Greater Brisbane from 6pm on Friday 8 January to 6pm on Monday 11 January, arising from the diagnosis of a mutant strain of COVID-19 in the community, did cause anxiety about health and economic safety. The changing border restrictions relating to parts of New South Wales were closely monitored. In this period the Weekly Industry Bulletin was distributed and member’s with technical or workplace relations issues were able to access key advice.
Advocacy
Unusual for this time of the year is the steady stream of advocacy duties. These started with the Australian Treasury’s Options for mandatory adoption of electronic invoicing by businesses.
I mentioned this in last month’s Viewpoint in Motor Trader and do so again as it is a digital issue that members need to consider in terms of their operational systems. The Government’s intention is to mandate that all Commonwealth Government agencies must be able to receive e-Invoices by 1 July 2022. The Government will also work with the States and Territories on how state and local governments can also quicken e-Invoicing adoption. This will be followed by accelerating the adoption of e-Invoicing in the private sector.
By way of background, e-Invoicing allows the digital exchange of invoices between a supplier’s and a buyer’s software or systems. E-Invoices are exchanged using a secure network and a common proven standard such as Pan-European Public Procurement OnLine (Peppol) framework. It allows different software or systems to communicate with each other, similar to being able to make a phone call to another phone, regardless of either phone’s model, brand or carrier. The purpose of e-Invoicing includes efficiencies, improving payment times to suppliers and combating the black economy and tax evasion.
At this time of the year, the Australian Government calls for priorities for the 2020-21 Budget. We submitted a pre-budget submission detailing the significant automotive industry issues for consideration. It is on the website for members perusal.
A crucial submission on behalf of our Queensland’s Automotive and Engineers Division (mechanical repairers) and the Australian Automotive Dealers Association (franchised dealers) has been the response to the Exposure Draft (Mandatory Vehicle Service Repair Information Sharing Scheme) Bill (the Bill). The intent of the Bill is to promote competition between Australian motor vehicle repairers and establish a fair playing field by mandating access to diagnostic, repair and servicing information for motor vehicles covered by the Bill to all repairers on fair and reasonable commercial terms.
Registered Training Organisations are also included similar to repairers. The devil is in the detail having provisions that should be amended in the legislative process to meet the Bill’s objectives. It is envisaged that the Sharing Scheme will take effect from 1 July 22, which gives time for assessment and further advocacy. We have carefully consulted with members in preparing our response and it is on our website.
Another submission of interest to members is the Productivity Commission’s Issues Paper on Right to Repair (the Paper). The Paper is not focused on the ‘right to repair’ and motor vehicles; rather it acknowledges and highlights the Australian Government’s proposal for a mandatory scheme for sharing motor vehicle repair information. Predominantly, the attention is on the products with sophisticated technology which has increased exponentially over the past decade. It is commonplace for mobile phones, refrigerators, coffee machines to have software and computers embedded in them, and even vacuum cleaners and electric kettles have sophisticated technology.
A key right-to-repair issue is how to balance the benefits and costs to consumers, supplier and manufacturers. The Productivity’s Commission is assessing the costs of a right to repair in Australia and the impact that regulatory or policy changes could have on market offerings for repair services and replacement products. We have interest in this Issues Paper, especially from the perspective of recycling and e-waste. Our response is on the website.
Group Chief Executive Officer Rod Camm in his From the Desk of the CEO referred to a briefing with Queensland Government Officers on the automatic mutual recognition of occupations across states and territories. I’ve now received the consultation paper which includes exposure draft legislation to which we will respond. I’ll provide further information next month.
Industry News
An issue that I hear from our franchised car dealers, apart from slow new vehicle sales, is the lack of stock to supply purchasers, some of whom have had to wait up to four months. The background is that manufactures anticipated plunging sales, misjudged the pandemic and associated lockdowns and other restrictions and reduced orders for computer chips. At the same time, semiconductor makers shifted production lines to meet surging orders for chips used in products like laptops, play stations computers, webcams, tablets and 5G smartphones. Businesses also upgraded their digital infrastructure to handle online meetings and employees working from home, while telecommunications companies invested in broadband infrastructure, further fueling demand for semiconductors.
The demand for new vehicles at the end of 2020 surprised manufacturers. The shortages of chips that ensued is expected to last well into 2021 because it can take semiconductor makers six to nine months to realign production and new vehicles can have more than 100 semiconductors. The absence of a single component can cause production delays or shutdowns.
Research by Moody’s Analytics indicates that slow new-vehicle sales, and even the late delivery of ordered new cars, has been offset during 2020 by the demand for used vehicles – the wholesale prices of which grew by 35 per cent, with the price of popular light trucks, SUVs and utilities rising by 46 per cent. The price of used cars increased by more than a third as Australians consumers traded in for either a cheaper or safer option. Prices are not expected to be maintained through 2021.
It is timely to reflect on the national compulsory Takata airbag recall in March 2018. I remember it vividly – the Australian Competition and Consumer advices and the briefings to members. Since then, the Federal Chamber of Automotive Industries reports that Australians have made over 12 million vehicle checks on the industry’s Takata airbag compulsory recall website. These checks identified more than two million vehicles equipped with faulty Takata airbag inflators having the potential to kill or seriously injure vehicle occupants. The 12 million milestone represents more than 67 per cent of the 17.8 million passenger cars and light commercial vehicles on Australian roads.
Finally
Over the next month or so, I’ll be attending the quarterly meeting of our industry divisions. The initial feedback is for a schedule of industry and policy issues to be raised to which I’m keen to hear and follow up.
Until next month, take care and stay safe.