Australia desperately needs lemon laws to deal with dodgy cars and dodgy dealers.
Reports of major problems with specific brands - notably the Chrysler/Jeep range, Mercedes and BMW, and horror stories about dealers and importers highlight the need. Add to that the appalling saga of Volkswagen’s (and its other brands’) deceptions and the need for consumers to be protected by law.
Fortunately I don’t own any of the affected brands, but I’m horrified at reading and hearing about the horrors that people who do are going through.
I suggest that Choice urgently needs to warn consumers about these dodgy brands and shady businesses and to champion lemon laws like those that protect US consumers.
We’ve been looking really closely at the lemon car issue recently, and conducted a nationally representative survey to find out how many lemon cars are out there, and whether or not consumers are able to get their problems fixed. Our report also looked at the worst car brands, in terms of number of problem cars. You can read the report here - https://www.choice.com.au/transport/cars/general/articles/lemon-cars-and-consumer-law
A review of the Australian Consumer Law is currently underway, and we’ve raised our concerns about lemon cars in our submission to the review. We’ve recommended a taskforce be established to fix problems in the new car sector, with industry-specific lemon laws to be introduced in two years if the taskforce fails to fix things. You can read our full submission here - https://www.choice.com.au/shopping/consumer-rights-and-advice/your-rights/articles/consumer-law-review-2016
Our concerns are being listened to. The ACCC has just announced that it will be conducting a 12-month market study into the new car market. We will be following this process closely, and will continue to call for reform throughout the ongoing review of the Australian Consumer Law.
With regard to lemon laws, is it possible to include recall laws?
Many people who buy a second hand vehicle don’t let the manufacturer know that they now own the vehicle and therefore miss out on recall notices.
Should it be law for the car sales person to notify the manufacturer of the new owner, or at least have a form that can be filled in?
These recent airbag recalls go back many years. Most people don’t even know about them unless a friend tells them.
This is an interesting idea, and one to explore. We looked at the recall system as a part of our submission to the review of the Australian Consumer Law, and we considered a few different options for improving the ways that recalls are communicated to consumers.
For instance, we think businesses should have a legal obligation to use all reasonable means to communicate their voluntary recalls and the remedies available to consumers. That is, instead of just publishing a newspaper ad, they should also be advertising on television and social media channels - this is where most people expect to hear about recalls, after all.
You’re correct that there are problems with the way recall information is communicated to consumers - so many people affected never even find out about the recall. Improving this is a priority for CHOICE, and one we’ll continue to focus on through the Australian Consumer Law review process.
May I suggest that the concept of lemon be extended out to endemic issues with older cars. We have a 10 year old ‘semi-automatic’ Ford Transit which has had 2x major failure of the dual clutch transmission. The first one was some 5 years ago, and the second this year. The earlier one was before I bought the vehicle, but I had the receipts.
When it broke down early this year, I took the vehicle a very large Ford dealership who claimed not to know about the problem. After discussing it with me, they the transmission off to a third party specialist who couldn’t diagnose what the issue was, and therefore was unsure on whether it could be fixed or not. The only other option was a new transmission. They made enquiries, and quoted… wait for it… $28,000 (yes, twenty eight thousand dollars) for a new transmission. (The vehicle was worth about $16,000 running properly.)
When I started Googling the problems, I discovered that this problem was very common, and reported in several models of vehicles here and overseas that had dual clutch system. I also found out that Australia Post and at least one Ambulance service had let contracts to replace these transmissions in their Ford Transits with full automatic transmissions from Holdens.
Eventually, this is what I too did. In total, this recent breakdown cost $9,000, money that we couldn’t really afford, but not running the vehicle was worthless.
It is wrong that Ford will not accept any responsibility for a problem on this scale.
So when thinking about lemons, please consider that some flaws only appear after some years, but are none-the-less flaws in design or construction.
Amazing how life has changed for the multinationals now that they have become nothing more than importers. It took a while and some may feel the $10 million is a token, but s.l.o.w.l.y moving in the right direction.
At a rough guesstimate BBG they still got off around $74,000,000 cheaper than had they replaced all those transmission themselves. If the cost to replace those 10,500 transmissions was $8,000 a piece then the bill comes to $84,000,000 - paying a lazy 10 mill instead will get the CEO a nice bonus lol.
Before you criticize and abuse, walk a mile in my shoes. As a former Federal Compliance Manager, the real issue with ineffective regulators is the legislation they are burdened by. Legislation at the Federal level is usually (on average) about 50+ years old. Amendments to Regulations are frequent. Review the scrutiny of X days in Parliament for review any new Reg amendment? Look to the abilities, and skin-in-the-game interest, of Pollies. Yes, give them a cracker - so what are reasonable expectations. ASIC has been criticized for inaction or too few prosecutions. Fact check - look to the success in the Courts to all Federal Regulatory activity. ASIC failed in the Courts wrt a big 4 Bank. What was the ‘penalty’ for Storm Financial indiscretion.
It is an unemotional financial cost/benefit criteria for Corpses (multi national and local) to challenge Regulators as the enabling legislation is so weak and outdated to a constantly moving world. IMHO any Local, State and Federal Legislation and Regulations should have a sunset clause (say 10 to 20 years). Parliamentary committee(s), or a new all encompassing Integrity Agency, should review enabling legislation for “fit for the purpose” review.
What can be said of our legal system? IMHO it is more antiquainted than the Regulatory framework. The adversarial common law system clearly favours the elites (however quantified). Precedent can be drawn from centuries earlier, and frequently is, by Judges that are nearly that old. The total knowledge of the world doubles in decades, while our three pillars in The Constitution are past their use by date.
The Drum panel discussed the background to the recent formulation of The Aged Care Act. The Howard G required say $30B of funds to meet the demand. Clearly a Conservative crew looked to the private sector, as the matra often repeated is that this is more cost efficient. So do an evaluation, or back end propagation, of the achievements in Health, Aged Care, Education, or utilities such as electricity, gas, and water? The profit motive does what it always does. Power, self interest and narcissism corrupts. Greater power merely potentiates this predictable human behaviour trait. I was in the Federal PS over the four term of JH’s G. IMHO, the first two were ‘normal’, while the last two demonstrated increasing malfeasance, ‘mates rates’ and possible corruption. The issue is that no Regulatory agency is, or was, able to discern this matter!!! Cheers Geoff
Hi human person behind BBG, CD. I totally agree that heads are the issue and should roll. Please note the failure to prosecute these heads and white collar crime in general. Decades ago I attended the Law Reform Commission review into Administrative Penalties. All or many of the big shots that appear on our screens were there, and I spoke briefly to some. Clearly their lofty status did not permit much time to a loser such as I/me. Strangely on reflection this expensive exercise produced a document that was substantially ignored. It may be for others to determine if this is a “course of conduct behaviour” for Governments and their agents? Cheers Geoff
Hi Geoff. As someone who was a former Federal Compliance Officer perhaps you might know the answer to a question I have on the matter. Is one of the failings of our regulators that of being under resourced? I’ve noticed since I moved from Sydney to Tamworth that there are quite a few companies doing things that would be caught in a city like Sydney, but seem to be par for the course up here? Things I’ve found personally range from underpayment of staff to flouting of NSW gaming laws, and the general attitude seems to be “no-one ever comes here to check up so all good”. It’s raised a concern with me that even if lemon laws were introduced at a federal level, wouldn’t make a Jatz Craker’s difference in regional/country areas. Seems at the moment the only way people can get action from a regulator is if they get their case on the news/7:30 report/newspapers.
Hi Obbigtam, there are no categorical answers to any matter, unless you are Yahweh. Opinions with appropriate standing in qualifications and experience improve the odds of a better perception. Any G program and also in commerce are subject to the mantra of efficiency dividends and productivity increases. Technology improvements do assist, yet appropriately qualified and experienced folk are required. The level of hypocrisy increases in proportion to the management level. Having the loudest voice was identified by Harvard Business School as determining promotion. This includes charisma and the skill to appear skillful. Better looks and grooming also exist. Note the conflation with hypocrisy and ability to deceive in any position of power. About a third of my work-life was in country towns smaller than Tamworth. I perceive that nepotism, or facilitating family and mates, is more prevalent in the country than the big cities. Relationships are closer IMHO. There are more competing private school networks, such as Riverview and the legal profession, and religious or cultural organizations in the big cities. The 4 corners program on the Murray Darling Water A… Yes, authority is a misnomer IMHO. Barnababy was overseeing the corruption and possibly facilitating malfeasance. OK, back to compliance matters. Any agency has many fish to fry and different priorities apply to determine where to apply diminishing resources. The real issue is that any G agency’s core objective is to deliver a program - NOT IF FUNDS ARE EFFICIENTLY UTILIZED OR FREE OF MALFEASANCE. Secretaries are highest level managers and are highest on hypocrisy. During attempts to achieve efficiency dividends, the simplest action is to decimate compliance activities. This actually slows down delivery of the program. The tension is real. THe Medicare payment system was interrupted for about an hour to compute my fraud and inappropriate activity neural network. Maybe State managers called to pressure me to turn off this activity. Hey, perhaps the Minister approved the action. The biggest kahuna rules - allegedly!!! The media is as much out of control as the rest of the power players and emotional issues rather than economic matters rule. LGBTI issues rule the progressive agenda atm IMHO. My complaint to the Media Authority was ignored and addressed/rejected by AI applications. Not a single word other, than complaint, was repeated in any response. In summary, there are many fish to fry in the compliance realm and perhaps bigger frauds belong to the financial industrial complex that is managed from the big smoke. The MDWA is an possibly an exception, yet far less interesting (meaning emotionally engaging) than live animal exports. The media follow exaggerated emotional hooks. Cheers Geoff PS. Apologies for often going off track!!!
Consumer Affairs Ministers have agreed to change the Australian Consumer Law to make it crystal clear that if you buy something that keeps breaking down, you get a refund and don’t have to keep accepting repairs.
This is all thanks to you. You shared your stories of dodgy caravans, lemon cars and frustrating experiences trying to get refunds for bad products. We used these in CHOICE’s submission, and it has resulted in a positive decision from Ministers.
When there are laws that just aren’t working for everyday Australians, we can rally together and get real change.
Spread the news to say thanks to all our supporters, and to Australian Consumer Ministers for taking action!
An older topic, and it is unclear if the last shoe has dropped, but Mazda has been called out. It will be interesting to watch if other manufacturer/importers change their ways, are prosecuted, or inevitable appeals and dodges survive.
I understand totally especially when buying a second hand car. Laws need change. The law, system stinks maybe Australia is broken allowing it tp happen.
Prior experiences would suggest business as usual will be hard to change.
The short news item reveals the car manufacturer prefers to be able to negotiate a settlement with the consumer in preference to meeting the full obligations of the ACL.
Why should consumers ever be placed in such a situation? The value of the purchase committed to is substantial and compared to any other life decision, second only to a home. The issues with the vehicles are often technically complex. The manufacturer and the industry selling motor vehicles holds all the technical expertise, data and negotiating skills to it’s advantage. There is no recognised independent motor vehicle expertise the consumer can turn to for support. It’s a role the National and State based motoring organisations could take up, but they are compromised by their close relationships to the industry and conflicted business models. The ACCC is not in the habit of taking on individual consumer cases, although it is the one with the greatest capability. Assuming it’s Federal funding allows, which some would say is always insufficient.
The ACCC media release on the court outcome.
The Court dismissed the ACCC’s allegations that Mazda had also engaged in unconscionable conduct in its dealings with these consumers. Despite finding that Mazda made false or misleading representations and gave the consumers “the run around” with evasions and subterfuges, the judge considered that the conduct fell short of being unconscionable.
The ACCC will carefully consider the findings on unconscionable conduct.
The Court will decide on penalties and other orders sought by the ACCC at a later date.
If only any fines imposed by the court went to the ACCC to top up it’s funding rather than government revenue?
Mazda can appeal the decisions as can the ACCC, hence it is all not quite settled until the court process is complete.
Previously the ACCC has taken on other vehicle importers over similar concerns consumers rights under ACL were not recognised. The lesser warranties provided by the importer were not acceptable.EG Toyota Dec 2020
P.S.
On Lemon Laws the following relates to Qld only.
One point to note in the QCAT disputes procedure. Consumers are expected to represent themselves unless granted leave to be represented. This avenue is open to either party to a dispute. Both parties are able to seek external legal and other advice in support of their preparation and submissions. It would be useful to hear whether the Qld legislation has delivered better or satisfactory outcomes.
