Car Care Products

New car prices in Australia should become almost totally transparent by the end of the month.

The Australian Competition and Consumer Commission ACCC will be enforcing ‘All-In’ pricing under a revision to the Trade Practices Act TPA and, for car buyers, that means an advertised price that will include the vehicle, dealer preparation and delivery charges, as well as statutory fees for registration, stamp duty and third-party insurance cover.

All advertised pricing will become ‘drive-away’ from May 25, under new regulations for all consumer products which will be enforced by the Australian Competition and Consumer Commission.

The change is being hailed as a major breakthrough by the ACCC. “The new law will not only mean consumers have accurate price information, but also that businesses have a more level playing field on which to compete when it comes to price representations,” says ACCC chairman, Graeme Samuel.

‘Clarity in pricing’ places an onus on motor car traders to advertise their cars with all costs aggregated in one sum. Under the amendments, they can still advertise the components of the price separately — but in addition to the ‘driveaway’ price. It is, according to the amendments to the Act, no longer sufficient to refer generically to ‘on-road costs’ and the total must be given equal precedence in the ad as any price component.

In other words, the advertised total of $19,990 must be the same font, same colour and printed on the same colour background as the $16,990 list price before on-roads are applied.

On the question of factory rebates for retail buyers; the TPA leaves no doubt that the dealer must outline the price to be paid by the buyer at the time of delivery, not inclusive of any figure to be remunerated after the sale.

If you buy a car for an advertised total of $25,000 — but you have to pay $26,500 initially because the total includes a factory rebate of $1,500, the dealer is in breach of the amended TPA.

The ACCC has also drawn the attention of dealers to ‘pictorial’ advertisements. Any ad with a picture of a motor vehicle must reflect the correct specification of car for the price advertised. Dealers are not permitted to picture a newer vehicle or one with extra-cost options and accessories fitted for an advertised price not consonant with the image of the vehicle.

Two sectors of retail industry have been specifically targeted by the revised legislation; the motor trade being one and the tourism industry being the other. The ACCC has prepared guidance material to assist the two sectors during the transition to the new advertising constraints, which will come into force from May 25.