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Rural neglect

24 December 2021

Dealers left out in cold

I spend a lot of time in workshops and dealerships across Victoria, and one thing I have learned is farm machinery dealerships are every bit as sophisticated as new-car operations.

The same can be said for motorcycle and commercial vehicle retailers.

So, it was disappointing to see the introduction of an automotive section into the Franchising Code of Conduct that only applies to new-car dealers.

Leaving farm machinery, motorcycle, and commercial vehicle dealers out of franchising reforms could threaten their survival, cause significant local job losses and leave the people they service without crucial equipment.

That’s why these dealers need to be included in the franchising reforms enjoyed by new-car dealers.

The government omission is puzzling, as the infrastructure requirements, capital expenditure, and business model for farm machinery, motorcycle and truck dealers is immense.

The new regulations do not apply to all franchise motor vehicle dealerships, only those that come within the definition of a ‘new vehicle dealership agreement’, which refers to dealerships that predominantly work with new passenger vehicles or new light goods vehicles or both.

Franchise agreements dealing with farm machinery, motorcycles, and trucks will not be captured under the new provisions. Consequently, these sectors won’t be afforded the same level of protection under the Franchising Code that new-car dealers enjoy.

The government has now created two regulatory regimes for dealing with automotive franchise dealerships. One that is comprehensive, the other which is not, and it is the predominantly rural and regional businesses that miss out.

Farm machinery dealers – and by extension their customers – deserve a fairer playing field.


Words: VACC CEO, Geoff Gwilym.

Share your thoughts! E: ceo@vacc.com.au. As featured in the Herald Sun 24 December 2021.

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