28 October 2014
Options Discussion Paper – 2014 Review of the Motor Vehicle Standards Act
Document General Review Commentary
Introduction
On behalf of the Motoring Advisory Council (MAC) and member base of the Australian Motoring Enthusiast Party (AMEP), I commend the Hon Jamie Briggs MP on calling for this review. It is with great pleasure that I make this submission as an individual andin support of the representatives of the MAC.
The review provides an excellent opportunity to re-evaluate our current policy and controls on vehicle standards, importation controls and general stimulus of the wider Automotive Industry, as we approach the wind up of domestic vehicle manufacturing in Australia.
While the impending wind up of vehicle manufacturing is a very regrettable and emotional milestone for our community, it is acknowledged that we must now look beyond the causes and outcome, to the future. In that regard the opportunities for improvement are enormous for the Australian Motoring Culture, and indeed the Government too.
Overall the review appears to offer a diverse range of options to consider, but it is becoming increasingly apparent from this document and prior writings of the Productivity Commission, that Government do not adequately understand the depth and diversity of the Automotive Industry in Australia.The scale and importance of Aftermarket Industry is continually overlooked or represented as being smaller than it actually is. In this regard, I am concerned.
When considering the Aftermarket Industry, a diverse range of impacts are faced by owners of enthusiast vehicles. We rely heavily on products and services of that industry. State based inconsistency, decades of poorly aligned legislation and a lack of evidence based decision making in the road safety sphere concerning enthusiast vehicles, are also continuing to strangle our community’s lifestyle, culture and the industries that support our passion. This is a unique opportunity to make improvements that offer huge benefits to our culture and community that is only lightly touched on by the review document.
The commentary in this submission is intended to highlight gaps and opportunities to encourage government to explore better ways of exercising its regulatory role (protecting consumer assets against theft and poor quality manufacturing processes). I believe this can be done without compromising the road safety or environmental outcomes, through a model that drives competition, a wide variety of consumer choice and firm support for the Australian Motoring Culture into the future.
Key information in the MVSA Review Document
I acknowledge the following key points in advance of further comment:
- Road trauma costs the community $27 billion each year.
- Ongoing compliance costs with the Motor Vehicle Standards Act 1989 costs individuals, businesses and the community $281 million per year.
- Significant changes have occurred within the domestic and global car markets since the MVS Act was last reviewed, 14 years ago.
- The Government has a role to play in controlling the standard of vehicles entering the Australian market for the first time.
- Over the past 40 years regulation of safety features has contributed significantly to road toll reduction and injury minimisation from vehicle crashes.
- Of over 1 million vehicles entering the Australian vehicle markets each year, 98% of them are new vehicles, with 88% of them imported and 10% of them manufactured domestically here in Australia. Used vehicle imports currently account for 1.9% of vehicles entering the market each year.
- Australia has been a leading nation in terms of ANCAP testing regimes and developing best practice vehicle standards, particularly noted is our leading role in improving outcomes from crashes involving pole like structures (trees and utility poles).
Road Safety in the Context of the MVSA
It is critical to our community that the Government recognises vehicle ANCAP ratings and vehicle standards do not lessen the chances of vehicles being involved in crashes. It is a secondary control that determines chance of survival once a crash has already occurred.
Road safety crash analysis for an ANCAP rating simply demonstrates that the age of a vehicle and nature of included safety features, determines that vehicles ability to reduce forces on people involved in crashes.
The National Road Safety Strategy asserts that “if everyone drove the safest car in its category, road trauma involving light passenger vehicles could be reduced by 26%. If each vehicle incorporated the safest design elements for its class, such trauma could be reduced by 40%”.
I am concerned Government are placing too much emphasis on statements like the one above when attempting to reduce the annual $27 billion cost of road trauma.
Whilst I realise it is a quote, the NRSS statement does not consider how best to reduce crashes at all. Nor does it consider the diversity of choices made by consumers. It simply places a scientific assessment over the fleet and existing crash trends, by assuming a probability of trauma.
It is grossly offensive to even suggest that this could be achievable as it requires every family to own a new car today, and every year into the future, just to sustain the crash severity reduction. I don’t know about you, but I don’t fancy changing my car more often than my smart phone.
While vehicle technology, road design and road conditions have improved in leaps and bounds over the last 40 years and speed limits continue to be reduced, little has been achieved in the area of driver training to prevent crashes at the source. Reducing the age of the vehicle fleet is only one way to reduce road trauma.
Over 99% of crashes involve some degree of driver error. Driver decisions in the moments leading up to a crash, can in most cases prevent or reduce the severity.Creating better drivers by implementing systems that are based on competence rather than compliance will lead to a better road experience that is safer for us all. This is especially relevant when you consider all the improvements made that have significantly reduced fatalities nationally, have had little effect in reducing the rate of casualty crashes. Over the past 40 years, the total number of casualty crashes and people injured has remained relatively constant in comparison.
It is far more effective to avoid crashes in the first place by adopting lower risk driving techniques. In this regard, enthusiasts aim to be recognised as the leaders in safe driving practice.
In my mind the role of the MVSA review is to update the act to encourage buyer choice and market efficiency by opening regulations to international vehicle imports. There is an important balance to be found in assuring that vehicle imports meet minimum safety standards without enforcing unreasonable legislation. Any legislation that places undue pressure on families to upgrade beyond their budgetary means, would only put additional downward pressure on an already fragile economy.
New Mass Production Vehicles
The new vehicle market is the strongest tool to regulate the quality and safety of vehicles on Australian roads. As the majority of new vehicles imported into the fleet go into their second lives as used vehicles, the quality and affordability of vehicles in the new vehicle market has a heavy impact on used vehicle consumers down the line. It is here in the used vehicle sphere that road safety statistics have benefitted most. Once theaverage age of vehicles nationally reaches a new safety technology milestone, crash statistics often reveal larger drops in severity. The initial safety benefit is typically minor as technology develops,while in comparison the much larger drop in crash severity occurs once the vehicles become affordable to average families, businesses and commuters.
While Australia’s average vehicle fleet age of 10 years, is older than other countries such as Japan 7.5 years, and Great Britain 7.3 years, it’s important to acknowledge the differences in geography and motoring culture in these countries. While the average distance travelled by Australians is reducing, the nature of the Australian psyche, the widegeographic spread of populationand even the urban density remains relatively unchanged.We are not subject to the same levels of air quality influence requiring turnover of vehicles more regularly (Japan).
The Australian people still drive more than these countries in a range of motoring conditions that are far more variable.Vehicles that do not last in our conditions quickly become scrap, while reliable vehicles remain in service until irreparably damaged or reaching the end of their serviceable life. It is the Australian way to get full use out of our assets, stemming back to learning’s from our settlement heritage. This is not a bad thing at all.
We at AMEP seek to encourage and promote the enjoyment of motoring and gain recognition of the wide range of benefits that the Motoring Culture provides nationally. As a nation of drivers, this does not mean we must subscribe to a domestic market, be prevented access to high quality international vehicles, accept lesser quality imported vehicles, nor does it mean the Australian consumers should have to pay more at the time of purchase, or be forced into dealer servicing regimes. Freedom of choice is the demand of today’s market. Supply is only limited by the regulations in place that prevent it.
I believe the most effective way to keep safety standards up and reduce the average age of the vehicle fleet in this country is to reduce the bottom line of prices by introducing competition and choice in the market. Regulation should be further harmonised with international standards whilst maintaining a strong focus on minimum safety and performance ratings. Beyond that regulation should be considerably wound back where practical, allowing the market to resolve the problems.Paragraph 2 on page 22 of the discussion paper acknowledges that this is one method to achieve balance in this regard.
Government objectives and consumer benefits are best achieved by a mechanism that supports and reasonably achieves the intent of Options 3, 4, 5 and 6.
Enthusiast production vehicles (post 1989)
Ultimately many of the production vehicles go on to become enthusiast vehicles. Some gain a cult enthusiasm from new (examples: Holden SS Commodore, Ford XR6 Turbo, Nissan Skyline or Toyota 86). Others take longer to develop a community of followers and the reasoning behind it can be very diverse (examples: Toyota Hilux, Mazda MX5). Some models never become widely available to our enthusiasts due to the import restrictions placed on new or used vehicles to protect our domestic car manufacturing sector (examples: Ford Mustang, Chevrolet Impala).
Given the sector is winding up, this provides opportunity to open markets to a wider range of vehicles as they are supplied new to the international market, offering a freedom of choice and value for money not previously enjoyed by Australians.
It also provides opportunities to encourage higher volume importation of high quality used vehicles to supply the market and encourage turnover of the older used vehicles bringing down the average age of our national fleet. This will lead to a new level of diversity within our community and promote further growth of the Aftermarket Industry through suppliers who can continue to offer products and replacement parts, to support a wider range of vehicles. This is a diversity I openly encourage as the benefits are far reaching.
Modified Vehicles
The diversity of our member base and culture is strongly linked by the freedom to modify vehicles as owners seek to customise, performance enhance, adapt, retrofit and restore them years or even decades after release.The $11billion Aftermarket Industry and its steady growth is a testament to enthusiasts desires to express themselves through their vehicles. That passion can start from a family grounding with the model, a new purchase, a child hood experience, literally anything.
The National Code of Practice for Light Vehicle Modifications (NCOP) and VSB14 regulate the modifications for safety in a very effective way against ADR’s. States such as NSW and QLD have recently shifted towards the NCOP regulation framework.
State based inconsistency and enforcement around modifications are still significant issues to our community.These individual state authority systems, requirementsand layers of confusing red tape strangle the Motoring Culture by burying enthusiasts in regulation paperwork that even the best engineers struggle to follow.
Worse still enthusiasts currently struggle with the legality of modifications (engineer certified or not) as they travel interstate. It is lunacy that an Australian vehicle owner can drive a legally certified vehicle in their home state, but then be deemed defective in another.
Vehicle standards in Australia must be nationally consistent for the whole of a vehicle’s life.This should be regardless to the extent of its age or modifications provided adequate engineer certification is in place to deem the vehicles are safe and fit for Australian roads.
Amendments to the MVSA could further strengthen the use of NCOP and VSB14, by pushing a framework that offers national consistency. By shifting toward a nationally consistent model that is heavily linked to the MVSA, state road authorities can shift into a registration, compliance and enforcement role. Removing the regulatory role from state road authorities enables government savings by reallocation of resources. It also prevents state bodies over ruling the national or international vehicle standards by implementing local registration controls.
The NCOP is widely accepted by industry and enthusiasts as a fair, effective, transparent and easy to follow mechanism for determining the requirements of vehicle modification. Linking the document to the MVSA is an administrative exercise that offers opportunities to save tax payer $ through cutting red tape and reallocating state resources, without introducing new or increased safety risks.
Safety Performance of Modified and Enthusiast Vehicles
I must also acknowledge that modified and enthusiast vehicle crash rates as well as insurance claim rates, are incredibly low (less that 1% based on advice from Shannons Insurance 2012). This is best demonstrated by the market expansion and changing policy positions of today’s insurance market, as they cash in on high annual premiums and low claim rates. The passion and expenditure that goes into enthusiast vehicles,motivates the driver to adopt a higher sense of care and much lower acceptance for risk when driving.
There continues to be a lack of evidence based decision making in the road safety sphere concerning modified and enthusiast vehicles. To date road safety measures and enforcement regimes implemented by the states have been emotive and highly discriminatory. None have adequately considered the safety performance of a vehicle involved in a crash when fitted with a modification. Similarly none have supplied documented evidence that modified and enthusiast vehicles are less safe in a crash than the original vehicle because of the modification.
Importing Vehicles with Modifications
To regulate safety standards of imported used light vehicles that have been modified it is recommended by the MAC, that import inspection systems harmonise with the NCOP by applying VSB14 and conducting engineer inspections to certify the vehicle as safe. This is a consistent and pragmatic approach to ensuring that even modified imported vehicles comply with the same regulations that are enforced within Australia by the states on locally owned and produced vehicles.
Example: An imported classic American muscle car, European classic and Italian exotic super car are bought at auction from USA.
The Italian Exotic is factory original spec unchanged since new. Regulation systems would allow this vehicle to be imported as its originality is intact. After its first registration modifications to the vehicle are made to increase horsepower significantly. By upgrading the Turbo chargers and fitting an aftermarket ECU the imported sports car goes far beyond its original spec status at the time of import.
The European classic has been fitted with upgrade disc brakes and suspension from an Aftermarket supplier to improve handling and performance of the vehicle. The stereo has been replaced with a newer device. Paint is original. Regulation systems are known to require that the vehicle be reverted to stock drum brakes, original stereo, and factory suspension to align with its release from factory. The safety and value of the vehicle are now both compromised by the import regulation system.
The American muscle car has upgraded disc brakes also from another model in the manufacturer range at the time. It has been resprayed with a new colour but the deed title, matching serial numbers and vehicle history checks out fine. This vehicle may be required to be reverted to original colour and reinstate the original drum brakes. The safety and value of the vehicle are now both compromised by the import regulation system.
These examples demonstrate regulations and import requirements that our members have faced. The vehicles could instead be assessed against the National Code of Practice for light vehicle modification document and VSB14.A qualified engineer can quickly and cost effectively consider the vehicles safetyperformance and it’s fitness for use on Australian roads in the modified state.