The Australian Competition and Consumer Commission has created a massive hiccup in the car market threatening car companies with criminal proceedings if they release national indicative car prices to the media or post national indicative car prices on their web sites.
Yesterday I sent the following position statement and questions to the chief of the ACCC, Graeme Samuel. ACCC press officer Lin Enright told GoAuto that the questions would be put to ACCC officers and would have to be cleared by their legal advisers before they could respond.
No response has been received. GoAuto will publish the answers when they are received.
This is what I sent:
Get Crikey FREE to your inbox every weekday morning with the Crikey Worm.
GoAuto believes in the good intent of the price legislation and sees it as reasonable for the selling dealer to include all charges and arrive at a final selling price to promote. The same can be achieved by state-based dealer advertising groups.
The problem arises in arriving at a national selling price because of the massive variation in local charges most of which are imposed by different governments.
This has led to the position where most car makers are no longer providing prices to the media and some are asking that references to prices are withdrawn from previous stories and from price comparison lists because they fear criminal prosecution from the ACCC for supply the media with this information.
Prices have been withdrawn from most car company web sites.
While the media is not subject to the legislation because we do not supply the vehicles, the car company public affairs managers fear that they may break the ACCC interpretation of the legislation by supplying the prices to the media.
It appears car makers are not prepared to put their employees at risk of criminal prosecution by the ACCC for supplying the media with car prices for the purposes of comparison.
If a way cannot be found to provide a national selling price for cars, consumers will be disadvantaged either by no longer being able to access prices in the media or by being confronted by massively complex price lists for the purposed of making value judgments in their buying decisions.
In my opinion piece on this, I am saying that this will cause a massive pause in car sales during the “worse recession since the Depression” at a time when the car industry was just getting some momentum again.
We are calling for the prime minister to step in because he understands that the industry is so fundamental to communities’ right across Australia.
- Is it the ACCC’s intention that the ability of consumers to compare prices from company web sites and from third party consumer sites be stopped? Is the ACCC wanting an outcome where the media is no longer able to publish new car prices in editorial about newly-launched models?
- By some estimates, there can be up to 75 final price variations for one car like a Holden Commodore Omega? For the purposes of comparing price between makes and models, is it the ACCC’s intention that consumers are faced with such daunting price lists? Is it reasonable for the regulator to impose such complication on the consumer when it was ostensibly acting in the interests of consumers?
- Given that consumers can no longer get prices from many car makers as part of the research pathway to purchase because of the interpretation of the regulator, does the ACCC believe it is assisting consumers or frustrating their efforts? Was it the intention of the ACCC that consumers can no longer get access to price comparison data to assist them make their buying choices?
- Many car companies now refer consumers to call dealers to get prices. Was it the intention of the ACCC that consumer will be put to so much trouble by the ACCC’s actions when they only a week ago had access to comparison information from their own offices or homes on the internet?
- It appears that under the ACCC interpretation of the legislation has gone much further than the legislation envisaged and treasury wanted. Did the ACCC discuss its final interpretation of the legislation with the car industry before it was released earlier this month? If not, has the ACCC therefore ambushed the car industry with tougher regulations that the legislation intended?
- The ACCC’s interpretation of the act was only released three weeks before the date it came into force yet Graeme Samuel told the ABC that the industry had plenty of notice going back to Costello. Is it deceptive and misleading for Graeme Samuel to go on national radio with such a statement when he knew that the complications of the envisaged regulations prevented implementation by Costello and knew that he stretched the interpretation of the rules beyond what the industry had expected from its discussions with Treasury at the time the legislations went through?
- Is it reasonable for a regulator, knowing of serious problems in the implementation of its regulation, to take an even harder line than envisaged without consultation; knowing there are unresolved issues? Given the uncertainly the ACCC knew it would create, is it reasonable for the ACCC to use the threat of criminal proceedings against working Australians to ambush them and bully them?
- One way to get national pricing for the purposes of consumer price comparison between makes a models is for dealers the sell the car unregistered and to tell buyers to organise a third party to register the car (paying to get the car on the road is where all the significant variable costs lie that affect the end price of the car purchase). Is it your intention that consumers should be put to this inconvenience?
- In order to prevent damaging market confusion for consumers and ensure they remain fully armed with the data they need to compare prices, is the ACCC prepared to declare a moratorium to work with the industry to create a national comparable price for each model that reflects the intent of the legislation – especially in terms of national pricing?
- Given that the ACCC is the regulator and has placed its interpretation on the new pricing laws, why does it then tell companies to get their own legal advice in implementing the new rules? And why does it expose honest working Australians within car companies to criminal proceedings over different interpretations of the rules? Is the ACCC not capable of developing iron-clad definitions and working with the industry to get workable solutions for consumers without threatening working Australians with gaol?
- Is it profession conduct for an arm of the Australian government to display in the motor industry regulations deceptive and misleading cartoons that are insulting and demeaning to industry participants? What role do these cartoons play in the provision of regulations that carry serious penalties for getting them wrong including criminal charges? Surely this is no laughing matter.
John Mellor is publisher of GoAutoMedia