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by Tim Beissmann

The Federal Chamber of Automotive Industries (FCAI) says the high level of competition in the Australian new vehicle market means that about 99 per cent of Australians pay less for cars here than they would for an equivalent vehicle overseas.

The findings are based on data from industry analyst IHS Automotive that compares the price and specification levels of various new vehicles available in Australia with equivalent models in the United Kingdom and New Zealand.

The report attempts to make like-for-like comparisons by estimating the cost of model variants in the UK and NZ with specifications equal to those offered in Australia.

In the case of the Ford Focus Trend (pictured), the FCAI claims that the popular small car is more than $10,000 better value in Australia than in the UK.

ford-focus-trend-2

The equivalent variant in Ford UK’s line-up, the Focus Edge, costs £15,600, which translates to roughly $28,300 based on current exchange rates.

Not only is the UK’s Focus Edge more expensive than Australia’s Focus Trend ($22,290), it also lacks a number of the features standard in our market such as alloy wheels, fog lights, cruise control, rear parking sensors, hill launch assist, front centre armrest with storage compartment, and many infotainment features including the Sync connectivity system. The UK version also gets a smaller and less powerful 1.6-litre petrol engine compared with Australia’s 2.0-litre unit.

The FCAI’s findings highlight data for 13 models. The majority listed in the report show Australian vehicles to be cheaper than their UK equivalents, with the exceptions being some premium models from BMW, Range Rover and Mercedes-Benz.

The comparisons do not include associated costs such as stamp duty, registration and other taxes, which the FCAI says vary considerably from market to market.

tony-weber

FCAI CEO Tony Weber (above) told CarAdvice the comparative data was intended to educate the community about cars and where the differences in prices and specifications lie.

“This is part of a regime that we’re going to put into place to put to consumers the reality of the market in Australia because we get a lot of distorted views about what it means to buy a car in Australia and run a car in Australia,” Weber said.

“The reality is that most people do not realise what a wonderful scenario is it. The CommSec Car Price Affordability Index shows that car prices are cheaper in Australia today than they’ve ever been. The other thing is you’ve never had the safety features and you’ve never had the environmental features as well, and the security.”

Weber says the high level of competition in Australia – with 67 brands selling more than 350 models – is a major factor benefitting consumers.

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He believes the FCAI’s method is the best way to compare the affordability of vehicles between markets.

“I think this is the most honest way to do it and this is the only meaningful comparison of the two markets. The taxation regime is not really at play,” he said.

“In no way is this overly simplistic, this has not been a simplistic exercise at all. What we’ve done is compare apples with apples.”

Weber admitted the comparisons became increasing irrelevant for more expensive vehicles where the luxury car tax becomes a factor, but offered a simple solution for that.

“We’re very happy to have the elimination of the luxury car tax in this country, very happy for that.

“That’s obviously a very big issue for the purchase of a car because the luxury car tax cuts in at a very hefty rate.”




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