Following an 18-month investigation into the new car retailing industry, the Australian Competition & Consumer Commission (ACCC) has called for reforms that aim to better inform consumers and improve their rights when purchasing new cars.
“Our research shows fuel consumption is the third most significant purchasing factor for consumers after price and model,” ACCC Chairman Rod Sims said in a statement.
Specifically, the regulator was concerned that new car buyers were not receiving accurate information about fuel consumption or emissions performance.
According to the ACCC, many consumers believe that advertised fuel consumption and emissions performance figures are what they will experience in everyday driving conditions – however there is often a gap between real-world fuel consumption and emissions.
In fact, the Australian Automobile Association (AAA) found that real-world fuel consumption is on average, 23 per cent higher than official laboratory test results.
The ACCC recommended that the Federal Government “introduce more realistic laboratory tests for fuel consumption and emissions, and an on-road ‘real driving emissions’ test to give new car buyers more accurate information.”
Another key observation from the ACCC’s review was that car manufacturers need to update their complaint handling systems and improve their approach to the handling of consumer guarantee claims.
As part of its investigation, the ACCC also reviewed a range of ‘dealer agreements’, which are commercial arrangements between car manufacturers and dealers.
“We are concerned that some manufacturers impose unnecessarily complex warranty claim processes, leaving dealers inadequately compensated for repairs or remedies provided to consumers,” Sims said.
According to the ACCC, dealers have direct responsibility to provide remedies to consumers but they also have a right under the Australian Consumer Law to recover the reasonable costs of providing these from the car manufacturers when the manufacturer is at fault.
Sims warned that the ACCC would take action if a car manufacturer prevents a dealer from fulfilling their legal obligations under consumer law.
The third key finding from the ACCC market study was that independent repairers have trouble accessing the technical information they need to repair and service new cars.
“The ACCC recommends introducing a mandatory scheme requiring car manufacturers to share the technical information needed to repair and service new cars with independent repairers,” Mr Sims said.
“The ACCC will now work to implement the study’s actions and recommendations, including taking enforcement action where we see potential breaches of the Australian Consumer Law.”