AUSTRALIA NEEDS TO LEARN FROM CHINA

The Australian government could take a lesson from its Chinese counterpart when it comes to supporting its automotive industry. That was the chief lesson AADA board member. Ian Field. took out of his recent visit to the Chinese Automotive Dealer Association Convention.

Unlike Australia, where the government seems to think that any and all competition is good competition, the Chinese government understands the need to monitor and regulate participants, particularly in areas such as the quality of used car reconditioning.

“They understand that competition needs to be controlled and they seem to understand that allowing anybody to compete – just jumping in without following appropriate practices – (does not make for the best outcome),” Mr Field told Automotive Dealer after returning from his trip.

“They were focusing on making sure the people who compete in that space gave consumers a good product. And I think that’s something totally lacking in our situation. We think that competition means letting anybody just pretend they are good at what they do, and then you’re competing with the lowest common denominator. You’re competing with somebody who, on the surface, is selling the same product, but which has not been reconditioned to the same standard.

“The Chinese understood that and were making sure that the standards were equivalent to all. I think that was fantastic.”

The Chinese government is interested in making sure its auto industry is sustainable for all involved, whereas the Australian government seems to believe that the more competition the better.

“We don’t make sure the competition’s equal. We let people do whatever they like and then protect them, by saying ‘oh well, they’ve got a licence to be a Dealer’. No one’s enforcing a standard,” Mr Field said.

“They really understood that allowing unfettered competition is not necessarily in the best interests of consumers if standards drop as a consequence. They have to enforce standards within the competition process to make the competition is competing on a level playing field.

“It’s what we argue consistently – we don’t mind competing on whatever the field is as long as it’s level. When governments allow the field not to be level they are not increasing competition; they are causing turmoil amongst those who do the right job against those that take shortcuts.”

The Chinese government is heavily involved in its industry, including participation at the CADA Convention. A high-ranking bureaucrat spoke about how the Chinese government sees its car industry as a very important part of its economy, hence manages it to ensure it is both sustainable for its practitioners and delivers the best possible result for its consumers.

AADA thinks the Australian government could take a leaf out of its book.

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