The Morrison Government is fast-tracking a rebalancing of the new car retailing market, with reforms coming in from today to ensure Australian car dealers are given a fair go.
Minister for Industry, Science and Technology Karen Andrews said she’s implemented the reforms a month ahead of schedule to improve the transparency and fairness of new car franchise agreements.
“It has been a tough time for our car dealers. Many have been grappling with GM Holden’s decision to leave Australia, many have been dealing with drought and now all of them are seeing significantly reduced sales caused by the COVID-19 pandemic,” Minister Andrews said.
“These reforms are the result of extensive consultation with industry. They balance the need to better protect Australian car dealers with ensuring an environment that is attractive to manufacturers to invest in our nation.”
Under the reforms all new dealership agreements will have to take into account additional considerations regarding end of term arrangements, capital expenditure and multi-party dispute resolution.
Minister Andrews said further work will also be done with industry on the issue of tenure and a principles-based compensation guide – with roundtable discussions to start this week.
Further steps that could be taken to support the automotive sector are being explored through the broader reviews of the Franchising Code of Conduct by Minister Michaelia Cash and warranties by Assistant Treasurer Michael Sukkar.
Minister for Employment, Skills, Small and Family Business Michaelia Cash, said the amended regulation, alongside the work of the Franchising Taskforce, is evidence of the Government’s commitment to striking the right balance between franchisees and franchisors to ensure the continued development and success of the sector.
“It is vital we support Australia’s franchise sector which creates jobs for hardworking Australians and contributes to the growth of our economy, especially during the COVID-19 recovery,” Minister Cash said.
“The Morrison Government is working methodically to deliver meaningful reform to the franchising framework which will ensure that it is fair, effective and accountable in the interests of both franchisors and franchisees, while avoiding unnecessary red tape.”