Calls by consumer advocates to introduce an automotive industry ‘lemon law’ ombudsman are misleading governments and regulators, according to a new report by the Victorian Automotive Chamber of Commerce (VACC).
VACC says that Consumer Action Law Centre data from 2020-2021 showed 3000 automotive complaints out of 5.1 million registered vehicles in Victoria, meaning there is little justification to introduce an ombudsman.
According to VACC, data from VicRoads shows 63% of the motor vehicles transferred are private-to-private sales and, for these consumers, it says there is almost no protection.
Meanwhile, VACC says when consumers buy from a Licensed Motor Car Trader (LMCT) they receive the following protections:
- In most cases, there is a three clear day cooling off period, a three-month/5000km statutory warranty if a car is not more than 10 years old and has travelled less than 160,000km
- Opportunity for the purchaser to make a claim for any faults or other issues under the Australian Consumer Law (ACL) if, in the opinion of the purchaser, the vehicle does not meet one or more of the ACL Consumer Guarantees
- The right for the purchaser to make a claim upon the Motor Car Traders Guarantee Fund in the event of a breach of the Act by the LMCT.
VACC’s report also outlined that the likely cost of the ombudsman proposal would cost Victorian LMCTs an additional $6.6 million a year – an annual contribution of $3000 per licence a year on top of the already existing annual licensing fee. It says that dealers will have little option but to pass this increase on to consumers.
The full report is available here
