SEP
2014
CRUISE CONTROL THE AUTONOMOUS CAR: FROM SCIENCE FICTION TO SCIENCE FACT
MEMBERS CLASSIC: FORD ESCORT MK I OFFICIAL PUBLICATION OF THE MOTOR TRADES ASSOCIATION OF QUEENSLAND
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Contents Official Publication of the Motor Trades Association of Queensland
Follow us on Facebook www.facebook.com/MTAQueensland
HEAD OFFICE Building 8, 2728 Logan Road, Eight Mile Plains, Qld 4113 P.O. Box 4530, Eight Mile Plains, Qld 4113 Tel: 07 3237 8777 Fax: 07 3844 4488 Toll Free: 1800 177 951 Email: publications@mtaq.com.au Website: www.mtaq.com.au EDITOR Jonathan Nash ART DIRECTOR Marco Ilinic INDUSTRIAL RELATIONS Ted Kowalski Michelle Chadburn POLICY Kellie Dewar, General Manager MTA Queensland ADVERTISING ENQUIRIES Emily Metelmann 07 3237 8784 Facsimile: 07 3844 4488 Email: emilys@mtaq.com.au
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EDITORIAL Editorial submissions are welcomed but cannot be guaranteed placement. For more information telephone the Editor 07 3237 8777
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SUBSCRIPTION RATES (including GST) Australia: $72.60 annually Overseas: $110 annually MOTOR TRADER PUBLISHING POLICY Motor Trader is the official publication of the Motor Trades Association of Queensland. The role of Motor Trader is to inform members of current issues and legislation affecting the industry. As such it can be regarded as the business magazine for the Queensland motor industry. The role of Motor Trader is not to be in competition with the technical magazines already on the market. It will advise of new vehicles being released and of the latest technology incorporated into them; it will advise of latest technology affecting members in each of the MTA Queensland Divisions; it will keep members abreast of the latest in motor industry training and industrial affairs; and it will keep members informed of the latest technical aids available through MTA Queensland Member Services, which will assist members in staying ahead of the technological revolution presently being encountered within the motor industry. The publisher reserves the right to omit or alter any advertisement and the advertiser agrees to indemnify the publisher for all damages or liabilities arising from the published material.
MTA QUEENSLAND ABN: 74 028 933 848
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From the editor Policy/Viewpoint Divisional news MTA Q&A MARK BRADY: BRADY'S BODY WORKS Feature HANDS FREE: THE FUTURE OF DRIVING? News NADA UNIVERSITY COURSES TO BE AVAILABLE SOON FERRARI 250 GTO SETS WORLD AUCTION RECORD
16 Members Classic MAKING ITS MARK: FORD ESCORT MK I
MEMBERS ESSENTIALS 19 Training matters 26 Member profiles 28 Industrial relations 30 Investment matters MARKET WRAP 33 Industry insight HOW POTENTIAL BUYERS LOOK AT YOUR BUSINESS September 2014 Motor Trader | 1
From the editor
H
JONATHAN NASH EDITOR
ELLO AND WELCOME to the September edition of Motor Trader magazine. In our main feature this month we take a look at the development of the autonomous car. There have been a flood of articles in the past few months as manufacturers, governments, and even software developers have released news of developments that suggest the driverless vehicle is an inevitability, although quite how long it will take for them to appear on our roads is yet to be determined. We take a look at some of the history behind the idea of the autonomous car, the technologies that have been already been developed and, in some cases, deployed, and where things might be headed. In our Members Classic feature this month we talk to Mark Motson, from Motson's Automotive Service in Brisbane, about his Ford Escort MKI. Mark's father, Tony, ran an Escort MKI, with great success, on Australia's racetracks in the early 70s and Mark clearly caught the Escort bug, finding a 1300 MKI which he has transformed, using a great deal of skill, into the racing machine you can see on page 16. MT also caught up with Mark Brady from Brady Body Works for our MT Q&A feature. Mark has been deeply involved in MTAQ and MIT over the years and his passion for developing his business and training his staff has put Brady's
SAVE THE DATE THE ANNUAL PRESIDENT’S Ball is the highlight on the automotive industry’s social calendar. This prestigious event will be marketed to all MTA Queensland members, clients and stakeholders and is expected to sell out. The evening will feature dinner, entertainment and dancing and will include an awards ceremony recognising the best and brightest trainees and apprentices at the MTA Institute of Technology. Date: 1 November 2014 Time: 6:30pm - 11pm Venue: Hilton Brisbane
2 | Motor Trader September 2014
Body Works in a strong position as it moves into the future. In Training Matters this month, we report on the annual MIT Trainers' Conference - held at MTAQ's headquarters - and focus on the technological changes that are being realised throughout MTAQ and MIT. The business has invested in cutting-edge computer technology and software that will strengthen and secure its position as the leader in the automotive training industry. It's an exciting time for the business as we look to the future and, with scaleability built into the system, we move forward with confidence. As always, we will endeavour to bring you news and insight into the automotive industry, the most up-todate information regarding training opportunities and, of course, continue to highlight members' interests with MT Q&A and Members Classic features. If you have a story you think is worth telling, want to appear in Member Profiles or have a classic car, bike or truck you would like to see featured, then please don't hesitate to contact me. Cheers
Jonathan Nash jonathann@mtaq.com.au
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Policy/Viewpoint MOTOR DEALERS AND CHATTEL AUCTIONEER ACT (THE ACT)
KELLIE DEWAR GENERAL MANAGER MTA QUEENSLAND
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T IS SOME six years since the MTA Queensland head office team visited Mount Isa to speak with and hear from the local Members. Divisional Executive Andy O'Hearn and I were there following on from the famous Mount Isa Mines Rotary Rodeo the previous weekend. We were lucky to have a room such was the crowd in the city. In fact, we were squeezed out of the meeting rooms we usually arranged. Thankfully, Tom and Paul Malouf (Malouf Auto Group) came to the rescue hosting the General Meeting at their Dealership. Thank you for your kind hospitality. Some Mount Isa Members were tied up with the business of the aftermath of the Rodeo but it was well attended including every Member from Cloncurry in attendance. We acknowledge and appreciate the distance the Cloncurry Members travelled to attend the meeting. We had a new member present too, who was signed up that day and welcomed to the Association - Rob Campbell of the Duchess Road Automotive Repairs. Andy is plotting that our next meeting will be in Cloncurry! Members engaged fully in the discussion and what was rewarding for us was that they were aware of all the information we spoke about and had seen it come through from us. This is such encouraging feedback particularly as our focus is delivering for Members.
4 | Motor Trader September 2014
As reported in July’s Viewpoint, the Office of Fair Trading is undertaking a series of Information Sessions across the State on the new legislation and regulation. To attend one of the sessions Members are reminded to check the times on the Fair Trading website: http://www.fairtrading.qld. gov.au/about-us/latest-news/pamdasplit. Registration is necessary to attend and Members should not delay to notify their intentions. I encourage Members to engage in these sessions to gain understanding of the changed administration requirements. There is a significant reduction in the compliance burden - in other words red tape is being worked through. We have a productive dialogue and sound working relationships with Officers in the Office of Fair Trading (and I must add Department of Transport and Main Roads). Members should leverage from this particularly by attending and participating in the Information Sessions.
AUSTRALIAN COMPETITION AND CONSUMER COMMISSION SUBMISSION (ACCC) Paul Petersen, Chair of the Queensland Motorcycle Industry Division, raised with me a letter that some of his Members had received from the ACCC. This related to an exclusive dealing notification lodged by Yamaha Motor Australia Pty Ltd (Yamaha). The Yamaha proposal was that franchise services would be supplied on the “condition franchisees do not (unless Yamaha has provided written consent) supply, offer to supply, promote or recommend finance and insurance products (in relation to Yamaha motorcycle and marine products) offered by competitors of Yamaha Motor Finance or a joint venture to be formed between a Yamaha group company and NM Insurance”. By notifying the conduct to the ACCC, Yamaha was able to gain statutory protection from the competition provisions of the
Competition and Consumer Act 2010. This legal protection commenced automatically on 29 May 2014. Paul and his Members were of the view that we, the MTA Queensland, should respond in strong terms as, if ratified, it had serious consequences for both Yamaha Dealers and consumers alike. We responded with a submission that included “that the precedent and the business model the Yamaha Exclusive Dealing Notification establishes, if ratified, provides such a broad ranging indemnity for the misuse of market power by franchisors and the creation of monopoly rents that it is likely to be emulated by many franchisors to the detriment of franchisees that comprise the automotive value chain to the extreme detriment and to the considerable disadvantage of consumers.” The submission may be viewed on our website.
BUSINESS ADVISORY FORUM Our MTA Queensland President David Fraser attended the third Queensland Business Advisory Forum. This was a breakfast session held during Exhibition Week hosted by the Premier Campbell Newman. The topic was “Government levers to stimulate business growth in Queensland”. The President drew attention to the diversity and decentralised nature of the automotive value chain, its importance in underpinning the economy from the service sector to construction, to the resources sector etc. He also drew attention to impact of the drought on the various businesses in these areas. The President placed on the table the need for increased focus on training to address the skill requirements of industry but also as a pathway for employment. Attention was drawn to the MTA Institute of Technology which services the skills requirements of over 1,000 Queensland workplaces. Other policy matters raised included the reform of workplace relations which was acknowledged as a Federal responsibility, continuation of the good work done by the State
Government in the reduction of red tape which had advantaged the motor trades; containing increases and taxes particularly a moratorium on the payment of stamp duties on business and household insurance policies; and the upgrading of infrastructure. The extension of the freeze on registration fees for private cars weighing less than 4.5 tonnes, which expires on June 30, 2015, was proposed as an ongoing stimulus measure.
AG SHOW I trust members from the western, northern and southern Downs have the Ag Show from 2nd -4th September in their schedules. President David Fraser and Chair of the Queensland Farm and Industrial Machinery Dealers Division said that it has become more industry-driven having forged strategic partnerships with Department of Agriculture, Trade and Investment Queensland, University of Southern Queensland, Ag Force and the Australian Agricultural College Corporation. We will be there too.
PETROL PRICING The ACCC is taking federal court action against petrol suppliers BP and Caltex and retailers Coles, Woolworths and 7-Eleven over allegations they illegally shared petrol pricing information. The ACCC has alleged too that the petrol pricing website, Informed Sources, which collects pump prices from each of the petrol retailers, allowed the retailers to “communicate with each other about their prices, and that these arrangements had the effect, or likely effect, of substantially lessening competition in markets for the sale of petrol in Melbourne”. This has the appearance of being a test case in relation to competition and petrol pricing. It will be interesting to follow this case to see if its consequences have flow on ramifications in relation to competitive behaviour in the Queensland retail fuel market.
PERSONAL PROPERTY SECURITIES ACT REVIEW The Federal Government has received the interim report on the statutory review of the Personal Property Securities Act which form part of the Government’s 2014 Repeal
Day. The Small Business Minister Bruce Billson said that the report made it clear that more could be done to help small business. I will draw Members' attention to the discussion paper when it is released. In the mean time, the report and further information regarding the review is available at http://www.ag.gov.au/ppsareview
THE ECONOMY The Reserve Bank Chairman Glen Stevens was in Brisbane recently to address the House of Representatives Standing Committee on Economics. This was the first time the Committee had met in Queensland since 2008. The Chairman, with a caveat about the unreliability of forecasting, indicated that over the year national growth will be around 2-3 per cent - but a bit below trend in the near term. Encouragingly he said that further ahead “there are some reasons to think that growth could speed up somewhat and be a bit above trend.” At its August meeting, the Reserve Bank Board left the cash rate at the historic low of 2.5 per cent for the twelfth month in a row. Reading the Reserve Bank Board minutes it seems there is no mood to change the cash rate. The Board’s judgment is “that monetary policy was appropriately configured and that, on present indications, the most prudent course was likely to be a period of stability in interest rates.” In other words the expectation is that the cash rate will be held at its lowest in 50 years for some time yet. Consumer confidence appears to be improving. The Westpac Melbourne Institute Index of Consumer Sentiment increased by 3.8 per cent from 94.9 to 98.5 in August. This makes the index only 1.2 per cent below its level prior to the Federal budget. One of the factors that may have helped consumer confidence is the abolition of the carbon tax. According to the latest Australian Chamber of Commerce and Industry small business survey, difficult business conditions persisted through the June quarter. Similar to previous quarters, sales revenue, selling prices, profits, employment and investment indicators were all recorded firmly in negative territory. In addition, most of the expectations indicators fell.
A spot of good news for the Queensland economy was the recently released Deloitte Business Index which indicated “a positive outlook for the State” transitioning from a “mining investment and construction to a more diversified economy.”
NEW CAR SALES The Australian Bureau of Statistics (ABS) New Car Sales (seasonally adjusted s.a.) for July indicated a slow market with new car sales at 18,385, down 1.7% from June. Compared with July 2013 when new car sales peaked at 19,173, the decline has been 4.1 per cent. It is concerning that for 6 of the past 12 months new car sales (s.a.) have been below 19,000 units. The respected VFACTS similarly indicate a fall in new car sales. In original terms, there were 17,767 new car sales, down 851 units or 4.6 per cents. On an annual basis the decline was 4.7 per cent or 6,581 units. VFACTS analysis of the new car sales data indicates the popularity of sport utility vehicles (SUVs). Nationally, these sales accounted for 31.4 per cent of the January to July 2014 motor vehicle market, and 32.1 per cent of the market in the month of July 2014. Government purchases of new motor vehicles continue to increase in 2014, with sales up 8.5 per cent compared to July 2013, and 6.4 per cent compared to the same Year to Date (YTD) period in 2013. Government buyers purchased 31.8 per cent more SUVs than in July 2013 and 11.4 per cent new passenger cars. Business sales continued to fall behind 2013 sales figures, with business buyers purchasing 5.1 per cent fewer new motor vehicles than in July 2013; bringing YTD figures 8.4 per cent lower than in 2013. The ABS Motor Vehicle Census (MVC) has been released which relates to motor vehicles registered at January 31, 2014 with a motor vehicle registration authority. These vehicle types comprise passenger vehicles, campervans, light commercial vehicles, trucks, buses and motor cycles. At the time of the 2014 MVC, in Australia, there were 17.6 million motor vehicles, including motor cycles, registered. This is 2.6% higher than the number of registrations for 2013 and an increase of 12.5% since 2009. September 2014 Motor Trader | 5
Policy/Viewpoint The average annual growth rate over the five years to 2014 was 2.5%. In Queensland there were 3.7 million motor vehicles registered which was a change of 2.8% compared with the previous year - the highest of all the Australian States. The change over the five year period from 2009 was 12.9 per cent - again the second highest of all the Australian States.
the latest tax and super news. Member’s attention is drawn to this tool. It may be accessed at www.ato. gov/sbnews. The newsroom gives small business the chance to subscribe to the latest news, rate articles and add important tax dates to their calendars. Small business has the option to cease receiving the general ATO letters and read the information in the newsroom.
SMALL BUSINESS AND FAMILY ENTERPRISE OMBUDSMAN
SMALL BUSINESS PARTY OF AUSTRALIA INC
The Federal Government has responded to the Small Business and Family Enterprise Ombudsman discussion paper to which we responded as a stakeholder. The Federal Government has settled on a model with real powers for the transition of the Small Business Commissioner into the Small Business and Family Enterprise Ombudsman. The Federal Government’s aim is to help businesses to help themselves. The Ombudsman will provide straight forward, honest advice to help businesses understand disputes and how they can be avoided in the future. As part of its key responsibilities, the Ombudsman will be a: • Commonwealth-wide advocate for small businesses and family enterprises; • Concierge for dispute resolution service; and • Contributor to the development of small business friendly Commonwealth laws and regulations. The Ombudsman purpose is to seamlessly link with the Government’s Single Business Service to help small businesses easily find out about other Government services and programmes, including general business advice.
ATO ONLINE SMALL BUSINESS NEWSROOM The Australian Taxation Office (ATO) has heeded the call that “small businesses just want to be told what they need to know and when they need to know it to ensure they get their tax and super right”. Working with small business, an online small business newsroom has been developed providing, in one place, 6 | Motor Trader September 2014
It is of interest to note that an individual at the 12th National Small Business Summit held in Melbourne earlier this month announced the intention to register with the Australian Electoral Commission a new political party - the Small Business Party of Australia Inc. The Council of Small
Divisional news Ben Chesterfield
NACA The third quarter of the year and still so many balls in the air, whether it be insurer contracts, workshop codes of practice, new privacy laws, code of conduct review, realistic times and rates, shop grading or lack of work etc - we have had it all. And in the light of all this we continue to survive. I was in attendance at the Paint and Panel live in Sydney last month and saw a few familiar faces. These are the type of events that we as an industry should be attending as the information available on the day was very informative and those who attended certainly gained some useful knowledge. We have also recently distributed the information regarding the Holden Collision Forums to be held in Brisbane. I would encourage everyone to come along to support this event, it is great to see a manufacturer being pro-active in this space. We recently held our Introduction To Diagnostics trade night which was
Business of Australia did not endorse the intention to register the Small Business Party of Australia at their summit.
VISIT The next Regional Meeting is at Mackay on Tuesday 9th and Wednesday 10th September. The Annual general meeting will be held on the Tuesday evening. I draw to the attention of our Emerald and district Members that the Regional Meeting dates have changed and are now Wednesday 15th and Thursday 16th October. The original dates clashed with the Labour Day public holiday. I look forward to speaking with, and listening to, our Mackay and district Members about their issues. In the mean time, to all, take care.
with Ben Chesterfield and Ian Cole attended by MTAQ members and guests and which was designed to educate the industry on scan tools. Also in attendance was Ezi Methods which was arranged by Car Craft. This was a very informative presentation regarding online repair methodology - where OEM-sourced information is accessible. I would also like to take this opportunity to remind you of the NACA AGM to be held later this month. Please come along, meet your committee, have a listen, have your say and lets unite to make a difference moving forward with our industry.
ERAQ Once again there isn’t much to report for the engine reconditioning division. There has been no real issues raised and the only topic of discsussion is the combined ERAA/ NZ conference, which I'm sure you are all well aware of. It is being held on the Gold Coast on 25-28 Sept. Please check the website for all details. I would encourage you all to stop and think about what is required
within this division. We all know this is a specialised division and I'm sure that there are issues that we face from day to day that could be faced as a whole. So please make contact, use your membership and make a difference.
AED The AGM was held recently and welcomed the new committee. It is good to see some new faces and I would also like to take the opportunity to thank the outgoing committee for their years of service. I'm sure the new committee will be pro-active and willing to serve constructively on issues that are facing the industry at this time. There are some hot topics on the agenda and we will be working hard towards addressing these in the coming weeks and months. We recently held our introduction to diagnostics trade night which was attended by MTAQ members and guests and which was designed to exhibit the latest in hi tech diagnostic tools. So please remain positive, keep the lines of communication open and
remember, without your input we can't achieve the best outcomes.
Ian Cole ARD Motor Dealers & Chattel Auctioneers Act I hope all ARD division members registered and attended the information sessions conducted by the Office of Fair Trading. There is a summary of changes due to the PAMDA split available on the Office of Fair Trading website. Dob in a Backyarder Again I refer members to the portal on the MTAQ website for reporting cases of unlicensed trading. This initiative is for your industry and any information is vital in order to decrease instances of unlicensed trading in your industry.
QFIMD It is heartening to report there has been rainfall across some parts of QLD in the past two weeks. Although not drought breaking,
it may give some confidence to the industry which has been struggling for some time. The AG show is upon us again being held at the Toowoomba Showgrounds 2-4 September. With recent rain I hope this results in increased activity in the industry and wish all exhibitors and patrons a very productive AG show.
APRD Some members have been enquiring about the use of wheel stands in their places of operation. I have some information regarding their use and also recommendations. If you require this information please contact me.
TUDQ The AGM is on Monday 8/9/14 Please come along to the AGM , meet the new committee members and have a say in your industry. For all divisions who received the presentation from Auto Skills Australia at their respective AGM -have your input into industry training developments and forward your feedback to ASA.
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September 2014 Motor Trader | 7
MT: What services does your company provide? MB: We are an auto collision
specialist. We do panel beating, spray painting - we specialise in major smash structural repair work. Major smash has always been a key part of our business. When I started here in the mid-80s there were seven of us and we've grown steadily and taken over three buildings. I've now got 25 staff and we do 40 to 50 cars a week. It's busy. We also are licensed through Queensland Transport to do anchor points, child seats, restraints and disability aids. That is a separate business called Brady's Mobility Solutions. We do hand controls, ramps, wheelchair lifts and so on.
MT: How long have you been involved with the Mobility Solutions business? MB: About 18 months. I had a bad accident about two years ago, broke my back in six places and was in a brace for three months. It gave me a very different outlook as I worked 'on' the business rather than 'in' the business. We have totally redeveloped not only our way of thinking but our processes through the shop as well. It also sparked involvement in Brady's Mobility Solutions.
MT: How did your business change and how has your industry changed over the years? MB: Technology drives our
industry. The difference between the way we repair a car today to the way we repaired a car even seven years ago is dramatic. The equipment that we use, the processes that we use, and
Mark Brady has been deeply involved in the automotive industry for many years, including as a Board member of both MTAQ and MIT. And it is his experience, focus on customer service, staff training and the introduction of innovative business systems that has allowed his business, Brady's Body Works, to flourish in tough times. obviously the cost of doing business. Then you need to train your staff. My guys are trained with I-Car. It's important that we understand how a modern day car is built, engineered, and how it performs in a crash test scenario. It is vitally important that guys who are repairing cars are trained how to do that properly manufacturers give us specifications on how to repair a car and that's how we should repair it. We've seen massive change in the business. The computer systems we use - from quoting to tracking our workloads, right through the repair process - everything we do today is governed by technology. We have adopted processes here from the LEAN methodology (a Japanese business system focused on reducing waste, improving efficiency and reducing production time and costs) which has improved our cycle time and business flow dramatically. However, it's going to be pretty hard for the industry in the next few years. I think we are going to see a lot of consolidation. I think the insurance companies have gone through a fair
bit of change and that's putting a lot of pressure on our industry. And business-wise, the global financial crisis and the market has put a lot of pressure on everyone too. It's tough and you have to have a competitive edge - something different from everyone else.
MT: What is Brady Body Work's 'edge'? MB: The systems that we have in place and the training that we've put in place for our staff. We give an exceptional product in an exceptional timeframe to manufacturers standards. I think the service we give our customers is absolutely spot-on. One good comment can get you ten customers, so looking after a customer is vital.
MT: How did you get involved in the automotive business? MB: I'm a second-generation repairer. My father started the business 44 years ago and I've been coming out here since I was a young bloke. Most school holidays I'd come out and work to earn a bit of pocket money and I loved
Mark with Shop manager Serge Descy. The new competitive systems put in place at Brady's Body Works have produced a well-organised shop showing dramatic improvements in 'cycle time and business flow'
to get my hands dirty. I worked very hard, did my apprenticeship and then worked my way through the business from running the floor, becoming a foreman, dealing with customers and then starting with the office work.
MT: Is it important to have gone through all aspects of the business? MB: Absolutely. To become the owner of a shop you to have a very level grounding and a lot of training - and that includes business training. You need to understand the cost of doing business today to be competitive.
MT: Can you explain your involvement with MTAQ and MIT? MB: I am the departing chairman of the MTAQ's Body Repair division. Being a second-generation repairer I knew a lot of people in the industry and some of those, especially David Weatherall, were involved heavily in MTAQ. I got onto the committee as a young bloke just to witness what was going on in the industry before taking over the chairman's role and then becoming involved with MIT. Training is a passion of mine and I wanted to make sure our apprentices were trained correctly. That's what got me involved with I-Car too, because our industry had no training outside the apprenticeship system. I thought it was vitally important to train our staff in the modern repair methods. I'm still highly motivated to be part of MTAQ and I'm still on the Board of MIT. I think it's just time for a break and some new blood. With what I've been through in the last two years, it's time for me to concentrate on Brady's Body Works, making sure it is sustainable and that it will be here a long time into the future. September 2014 Motor Trader | 9
HANDS FREE: THE F Autonomous cars are no longer consigned to the imagination of the science fiction-loving geek. Every major car manufacturer, and at least one big computer software company, have turned their R&D clout to a future that, so far, we’ve only seen in the movies.
I
MAGINE THE SCENARIO: It’s early on a Monday morning. A few hours earlier you were at a social gathering, consuming a few glasses of decent red. You didn’t get home until late and now you're battling highway traffic on your way to a meeting. It’s not looking good. You could really use the time to get focused. Well, what if you did have the time? In fact, what if you not only had the time to get focused, but also the facilities to contact colleagues via Skype; or surf the web and get the latest financial updates? And what if you had the facilities to make yourself a decent coffee too? And what if you could do all of this in your car? Such is the future. For the age of the autonomous vehicle is just around the corner. Or so we are told.
10 | Motor Trader September 2014
This past year the trickle of news surrounding driverless cars has turned into a flood. Articles and reports emerge on an almost weekly basis regarding the newest technology, the latest road tests and the news of governments leaping on the possibilities this new era of transport might offer its economy.
UTURE OF DRIVING? “DEPENDING ON WHERE YOU
LOOK, STUDIES SUGGEST THAT BY AS EARLY AS 2035, AUTONOMOUS CARS WILL NUMBER IN THE TENS OF MILLIONS AND BE A REGULAR FEATURE OF OUR LIVES.”
In July this year, for instance, the UK government announced that autonomous cars would be able to be tested there in 2015 and that a review had been ordered into road regulations. “Today’s announcement will see driverless cars take to our streets in less than six months, putting us at the forefront of this transformational technology and opening up new opportunities for our economy and society,” said Vince Cable, the UK Government’s Business Secretary. Depending on where you look, studies suggest that by as early as 2035, autonomous cars will number in the tens of millions and be a regular feature of our lives. Sounds like science-fiction? It only seems that way. A number of manufacturers have either tested autonomous vehicles, have them in the pipeline, or have tested technologies that can only help to achieve that result. In the USA, several states have approved testing for autonomous
Google bosses Eric Schmidt, Larry
Page and Sergey Brin with a Goog
le driverless car
‘Platooning’ could see vehicles make massive fuel savings
vehicles on public roads – a move that has allowed Google to notch up nearly 700,000kms of testing of its driverless technology. BMW and Audi both conducted demonstrations of aspects of their technology in the US this year too, while Nissan outfitted one of its Leaf electric cars with its ‘Autonomous Drive Technology’ and tested it on an Expressway near Tokyo in 2013. The Mercedes S500 Intelligent Drive car completed a ‘hands-free’ 100km drive through Germany this year and Mercedes has also demonstrated the capabilities of its ‘Highway Pilot’ system, which can detect how fast the car is going, how close it is to cars in front and even change lanes for you. This type of system has also been demonstrated on trucks, allowing for a technique known as ‘platooning’, where one truck, controlled by a driver, is the lead for a number of vehicles. The technology allows the following trucks to ‘stack-up’ behind the leader at close distances, creating a slipstreaming ‘road train’. Allowing the vehicles to slipstream like this means not only that more trucks can be on the highway, but would see a vast improvement in fuel economy. September 2014 Motor Trader | 11
And it is efficiency and safety that are the force behind the push to autonomous driving - Sebastian Thrun, who led the development of the Google car, is on the record as saying the death of a close friend in a traffic accident was a main reason for him to research such technology. And according to a report released in 2013 by the Eno Centre for Transportation in the US, if 90 per cent of cars on the road were autonomous cars, then more than 20,000 lives would be saved each year in the US. The reason? Autonomous cars don’t get drunk, or tired, or distracted. “A lot of this has to do with safety,” says Dr Glenn Geers, Technology Director, Infrastructure, Transport and Logistics for National ICT Australia (NICTA), the nation’s largest organisation dedicated to ICT research. “The vehicles themselves have reached the limit of what can be achieved with a human in the loop. “So the next logical step is to make the systems fully automated, and that’s what I believe manufacturers are working towards.” Transportation safety is one of the research areas for Dr Geers and he mentions the concept of the Cooperative Intelligent Transport System. “The Cooperative ITS is how you can increase the safety, sustainability and efficiency of the road network by having the vehicles talk to each other – it’s not about increasing what one vehicle can do on its own but about how they can
AUTONOMOUS CARS AND THE LAW Liability today Using a simple example, if a person driving a car was to lose control at speed and crash into a tree, we might consider the following parties as being potentially responsible: 1. The driver (who we will assume is the owner of the car for the sake of this discussion); 2. The car dealership who sold the car to the driver; 3. A mechanic who had recently serviced the vehicle; or 4. The manufacturer of the car (who for this discussion we will assume produces and assembles all of the parts of a vehicle, including the electronics). There are a number of factors which would be considered by the court in order to determine liability. Depending on the circumstances, multiple parties may be liable where more than one party is found to have materially contributed to the incident Where multiple parties are culpable, they would share the liability in the proportions determined by the court. If we fast forward to an age of driverless cars, where all cars on the road are autonomous - how might the assessment of liability change? Liability for driverless cars A self-driving car is controlled by computer software - artificial intelligence designed specifically to operate the car without human input and to deal with traffic conditions and other variables.
12 | Motor Trader September 2014
act together cooperatively for better outcomes.” It is essentially, says Dr Geers, Wi-Fi for cars. “The system has been optimised to work at speeds of up to 200kmh and at a range of 1000m, so every car can talk to other cars within a 1km radius. Vehicles broadcast data such as position, speed, steering wheel angle and so on, at 10 times per second and any car within that 1km is aware of what other cars are doing.” Technologies such as C-ITS are what are required to make a car truly autonomous, for a vehicle needs to not only be able to ‘sense’ the environment through which it travels but also respond to that environment. It needs to be able to map the world around it by spotting road edges, lane markings, signs, traffic lights, and it needs to be able to identify pedestrians, cyclists and other potential hazards. Which is why vehicles currently in development carry cameras, radar and LIDAR (Light Radar System - a sensor that works by using a laser to detect an obstacle, its shape and size) to help give it that information while GPS, accelerometers and wheel sensors help keep track of the car’s physical location. In truth, though the technology today now makes autonomous vehicles inevitable, it has been decades in the making. Cruise control, adaptive cruise control, GPS, automatic braking, self-parking functions, stop-start
One significant hurdle to the introduction of driverless cars is whether people would be willing to place their trust, and their safety, in the hands of computers. From a legal perspective, the issue of trust and reliance required of passengers to driverless cars is particularly relevant as it is an established principle of law that trust-based relationships give rise to duties of care. If the point of a driverless car to allow people to simply set the destination and then enjoy the ride, then the responsibility for the operation and movement of the vehicle must lie with the company who manufactured the car and programmed its software. Today’s consumer protection laws would impose an obligation on the manufacturer to compensate any person suffering injury or damage as a result of any safety defect. However, will a manufacturer’s closer connection to the actual movement and operation of a driverless car result in the law placing more onerous obligations on the manufacturer such as a duty to ensure the safety of its customer? For a conventional car which requires a person to drive, the car manufacturer is removed from the situation. The manufacturer has no control over where the car is driven, or the manner in which it is driven. As long as there is no safety defect in the car, the manufacturer is much more likely to avoid being liable for an accident. Driverless cars are a different story. There may still be ways in which a car dealership or a mechanic might be responsible for a crash. However, a manufacturer has a much closer connection to
the day-to-day operation of the vehicle due to its development of the software which controls it’s vehicles. In a sense, a manufacturer steps into the shoes of a driver of a conventional car. To minimise or avoid liability, manufacturers might lobby consumers and their insurers to take on all risk associated with their driverless vehicles as a condition of purchase. Would consumers agree to take on the risk? Before driverless cars can become widespread, it is critical that an effective legislative framework is implemented so that the issue of liability can be appropriately dealt with before any accidents occur. Taking a reactive approach may result in a substantial loss of life and money. Whether driverless cars are adopted on a large scale depends on how well car manufacturers, lawmakers and community members are able to work together to develop a workable regulatory system. There are many legal and social issues relating to driverless cars which need to be resolved before we will see any significant changes to private transportation. By discussing the issues, it might be possible to formulate effective laws to accommodate the evolving technology. If this can be achieved, then the transportation revolution may come sooner than we think. This is an excerpt of an article provided courtesy of Bennett & Philp Lawyers. Bennett & Philp Lawyers specialises in servicing members of the motor trades industry. For advice, please contact Mark O’Connor at Bennett & Philp Lawyers on 07 3001 2999.
technology, Bluetooth connectivity - all these functions are ones we accept as the norm on vehicles today, and each can be seen as a technological stepping-stone on the route to driverless motoring. You can go back as far as 1939 to see when the idea was first given serious thought. That year, at the New York World’s Fair, General Motors’ Futurama exhibit took visitors on a ride over an enormous model ‘future’ city - a city that included a sophisticated transport system and ‘autonomous highways’ ridden by ‘self-guided’ cars. Following up on this idea, GM built the Firebird series of cars in the ‘50s. The wildly futuristic-looking Series III had a function called ‘autoguide’ that worked through the use coils under the front of the car which straddled a current-carrying wire embedded in the road. The on-board ‘computer’ read the signals to control the car.
“DRIVERS SHOULD BE RELIEVED
OF CERTAIN ACTIONS, BUT ONLY WHEN THEY WANT TO BE — FOR EXAMPLE, WHEN AUTONOMOUS OPERATION MAKES DRIVING SAFER OR MORE COMFORTABLE.”
The Rinspeed XchangE
Nissan’s autonomous drive vehicle
General Motors Firebird Series III
Much research was done in the intervening years but it was the early part of the 2000s when things really picked up speed. In 2004, The Defense Advanced Research Projects Agency (DARPA) in the US opened things up to the wider scientific community by instigating the ‘Grand Challenge’ – a competition open to researchers that offered a prize to the team that built a vehicle that could, on its own, cross a 150 mile course in the Mojave desert. In 2005, five vehicles achieved the feat with the winner coming from a team from Stanford University – a team which included Sebastian Thrun. So assuming the inevitability of autonomous vehicles, what will it mean for the humble motorcar? If the purpose of the car is reduced simply to a means of getting from Point A to Point B, does that point to a world full of four-wheeled blandness? In a 2013 speech, Dr. Dieter Zetsche, Chairman of the Board of Management of Daimler AG said, “Drivers should be relieved of certain actions, but only when they want to be — for example, when autonomous operation makes driving safer or more comfortable . . . driving a Mercedes should not be ‘free of emotion’ - and definitely not ‘free of fun.’ That is our vision of autonomous driving.” So, perhaps a combination of autonomy and driver control is more likely? It may take another decade or more to find out, but some companies are so comfortable with the idea they have moved away from researching the technical aspects of autonomy altogether and are instead, looking at just how we humans will enjoy this hassle-free future. Swiss design firm Rinspeed recently unveiled the XchangE, a car based on the Tesla Model S. The XchangE is stuffed full of neat offerings for the hands-free ‘driver’ and passengers, with technology that allows occupants to surf the web, play games, watch movies thanks to a cutting edge entertainment system, and even make a decent cup of coffee. With seats offering adjustments that allow virtually any resting position, a steering wheel that can be moved to the centre of the dash to allow for more room, and a computer system that is fully networked with the outside world it is, Rinspeed says, a place where you can hold a ‘four-party meeting at 120kmh’. If that’s the future - that Monday morning trip through the rush hour traffic doesn’t seem like such a nightmare after all. September 2014 Motor Trader | 13
News .
AUTO SKILLS AUSTRALIA AUTOMOTIVE ENVIRONMENTAL SCAN 2015 INDUSTRY DISCUSSION FORUM
THE AUTOMOTIVE ENVIRONMENTAL SCAN (E-scan) is a federal report into the automotive industry. The report serves as an early warning mechanism for government. It captures current information and developments within the automotive industry and the training system in each state. To help inform the content of the E-scan, Auto Skills Australia will be holding industry discussion forums in Queensland. The purpose of the forums is to capture the latest intelligence from business operators and stakeholders on key issues affecting the automotive industry in Queensland. The matters raised will be reviewed at the highest levels of federal and state government. An industry forum is scheduled at the Motor Trades Association of Queensland, Wednesday 17th September. Address: Building 8, Freeway Office Park, 2728 Logan Road, Eight Mile Plains QLD Time: 6.30pm to 8.00pm Light catering will be provided. The following agenda items will be discussed: 1. Key issues affecting automotive businesses in Queensland 2. Current skill shortages and labour shortages within automotive 3. Major factors impacting on the shape and skills base of the workforce 4. The training system and how well its responding to user needs 5. Other issues / key messages for Federal & State Government The forums represent a unique opportunity for stakeholders to inform government on key matters concerning the automotive industry in Queensland. If you wish to attend please RSVP to Member Services at info@mtaq.com.au by September 10.
NADA UNIVERSITY COURSES TO BE AVAILABLE SOON S TAKEHOLDERS FROM THE National Automobile Dealer Association (NADA), the MTA Institute of Technology (MIT) and the Australia Automotive Dealers Association (AADA) made history at July's AADA National Convention with the ceremonial signing of documents to bring NADA University to Australia. NADA University currently provides the US automotive and truck industries with the most comprehensive source of web-based education and training and, as reported in previous editions of Motor Trader, the agreement to make the world-renowned courses available here will give Australian dealerships access to new opportunities for increasing knowledge and adding valuable skills to their team. Jim Phillips, the Director of Custom Education Delivery at NADA Dealer Academy was present at the convention and was at MIT's headquarters in August to help facilitate the training of Australia's NADA University instructors. The AADA will initially offer three new training programs for the
Dealer industry, commencing in the New Year. They are NADA University programs offered under an exclusive licensing arrangement between NADA and AADA and will be available across the country. As part of the landmark agreement, Dealers will have access to: • Service Department Operations Management. • Foundations to New and Used Vehicle Management. • Advanced New and Used Vehicle Management. Whilst the first mentioned course is a three-day intensive qualification, the latter two will run for two days. The signing of the documents, which was done in front of an audience of delegates, marks an exciting time not only for Australian dealers but the AADA as its relationship with NADA strengthens. "It is hoped that bringing NADA University to Australia will become just one of many exciting collaborative efforts between the two associations," said AADA CEO Patrick Tessier.
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MAKE: FORD MODEL: ESCORT MK I ENGINE: 2-LITRE TURBO-CHARGED NISSAN SR20 DET OWNER: MARK MOTSON OWNER SINCE: 2000
MAKING ITS MARK
F
OR THOSE OF us of a certain vintage, the Ford Escort MK I is a car that’s difficult to forget. In the late 60s and early 70s, the MK I was ubiquitous on racing circuits - a regular winner in motorsport events across the world. In 1972, a MK I driven by Mike Stillwell came second in the Australian Touring Car Championships, beating out many of the more-fancied cars, including the likes of the monstrous Falcon GTHO Phase III. That year’s series included a MK I driven by Lyndon Arnel - a car prepared by Tony Motson. Tony, after a long history in motorsports, now owns Motson’s Automotive in Brisbane, and it is no surprise to discover that the love of motorsport, and the Ford Escort MK I, runs in the family. Mark Motson, Tony’s son, bought this Escort MKI in 2000. Of course it didn’t look like this when he bought it. A joint venture with friend and Queensland racing legend Derek Pingel, Mark turned what was a pretty ordinary 1300 MKI into the beast you see on these pages. Designed with racing in mind, it’s a car that has the body of the MKI and . . . well, not a lot else - the three year epic build resulting in something close to a pure racing car. Building the car was to prove a challenge however, not helped by the fact that thieves broke in to his workshop a number of times, walking off with $25,000 worth of equipment. “Pretty much all that was left was the engine, the gearbox and the shell,” says Mark.
16 | Motor Trader September 2014
Finding the car in the first place was something of a challenge too. After agreeing to buy one car, Mark returned the following day to pick it up only to discover that it had been sold from under his nose. Disappointed and trudging back to work, good luck intervened. “There was a little MKI parked in front of our workshop,” he says. “It looked reasonably tidy and I asked the young lad who owned it whether he was interested in selling. “He said it had been his grandad’s and he had to ring his parents to check to see if it was okay. He rang them, they said yes, and I bought it on the spot for $450!” “I stripped it down completely,” he adds. “It is really the body shell and a bit of the interior. Everything else is completely re-manufactured. The engine is a 2-litre turbocharged Nissan SR20 DET from a 180SX. The gearbox is a Nissan Firespeed from the same vehicle and the differential assembly is from a Toyota Hi-Lux with KAAZ LSD. “The engine is absolutely stock-standard straight out of the half-cut, but it’s got a bigger turbo-charger on it, bigger injectors and an aftermarket computer. It makes 290hp at the tyres, which is 400hp at the flywheel. “I’ve tubbed the rear end too. It’s actually 100mm wider than a normal MKI. Everyone told me that it was physically impossible to put 16x8 wheels on a MK I Escort. I said
Courstesy Pete Trapnell @ trapnellcreations.com
nothing is physically impossible.” And the work didn’t stop there, with Mark even trying his hand at some DIY carbon fibre work, ingeniously utilising some home appliances in the process. “The car has a carbon fibre dash I built myself,” he says. “I cooked it in my wife Wendy’s oven at home. I made my own mold and it cost around $60. Nothing is impossible.” In fact, pretty much the only thing that Mark didn’t do himself was the paintwork. “When we built the car I said that it had to be bright yellow – the 360 Medina Ferrari yellow. It is beautiful. I love it.” Of course, building a race car virtually from the ground up would not mean much if it didn’t perform, but since debuting the car in 2003 Mark has notched up more victories than he can count, including a series win in the 2012 QLD-NSW Sprint Challenge Championship. Indeed, the car’s first victory took place at its debut event - the 2003 Gatton Sprints. “It was originally built for racing with Short Circuit Motorsport, a club run out of Toowoomba, which does circuit racing,” says Mark. The club has been the spawning ground for some top motorsport talent – Brendon Pingel, Derek’s son, currently runs in the Australian Aussie Cars Championship, and Will Power, the Toowoomba-born IndyCar star was a member too.
DO YOU HAVE A PRIDE AND JOY IN THE GARAGE THAT YOU WOULD LOVE TO SEE IN THE PAGES OF MOTOR TRADER? Contact Jonathan Nash at jonathann@ mtaq.com.au or 07 3237 8721 and let’s see if we can share your classic with other members. In fact, Mark still races occasionally against Bob Power, Will’s father. It’s an association that explains why Will Power’s autograph adorns the Escort’s dashboard. After a decade of racing the car, Mark doesn’t take it out quite so much anymore. Having bought out Derek’s ‘half ’ in 2007, the Escort takes a turn around the track only every few months. But, though Mark has received offers over $70,000 to take the car off his hands, he has no plans, yet, to let it go. “My hope is I might have grandchildren one day and another generation of the family will be interested in motorsport. Perhaps we could race it together.” September 2014 Motor Trader | 17
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ESSENTIALS Contents 19 Training matters 26 Member profiles
AUTOMOTIVE REPAIR CENTRE TOWNSVILLE MOUNT ISA HARLEY-DAVIDSON ROYANS BRISBANE
28 Industrial relations
Paul Kulpa, General Manager Training Operations, opened the conference
M
TAQ BROUGHT TOGETHER its trainers from around Queensland last month for the annual two-day trainers' conference, held at the Sir Jack Brabham Automotive Centre of Excellence. The team of 35 trainers had a busy couple of days as MIT not only introduced them to new state-ofthe-art technology and software designed to help them with the training process, but also packed the days with presentations from a host of automotive industry speakers. “The conference is an ideal way for our trainers to get together and discuss issues," said Paul Kulpa, General Manager Training Operations for MIT. "And the variety of specific industry presentations meant we could better meet the needs of our trainers." Guests speakers included representatives from Holden, Suzuki and BASF amongst others, and trainers were also able to visit mobile plant equipment supplier Hastings Deering to learn about the latest developments in that sector.
Paul Kulpa with trainers James Dixon, Peter Jaensch and Andrew Bellars. James Dixon picked up the Trainer of the Year Award
The conference schedule was a reflection of how much a trainer is required to do and the need for continuous professional development. "Training is a lot more than just sitting down with an apprentice and going through a qualification item," said Mr Kulpa. "A trainer has to understand the Vocational Education Training sector; they have to understand the training package; they have to understand industrial relations, educational requirements and compliances. And they have to have a relationship and understanding with the student. "The conference highlights how much we try to support them to develop their professional goals." Trainers were recognised for their hard work during the year with Brisbane-based James Dixon named Trainer of the Year with Andrew Bellars and Peter Jaensch runners-up. September 2014 Motor Trader | 19
E S S E N T I A L S
MEMBERS
M E M B E R S
MIT TRAINERS ATTEND ANNUAL CONFERENCE
E S S E N T I A L S M E M B E R S
Training matters
MIT MOVES INTO A TECHNOLOGICAL FUTURE M TA INSTITUTE OF Technology has entered a new era with August's trainer's conference seeing the release of new hardware and software systems to the MIT training team. Designed to advance the service MIT offers to its clients through improvements in efficiencies and communication, the new systems are a significant investment for the company, ensuring that MIT will remain the leading provider of automotive training. The innovative systems include new powerful Toshiba hybrid computers and iPad tablets. However, it is the development of new software that holds the key for the evolution of MIT's training business and, over the next few months at least, the MIT trainers' jobs in particular. ICT Manager James Orr worked closely with mobile technology software company ARIS to develop a unique version of the company's product, called ARISApp. Able to be used across mobile phones, tablet computers and desktop machines, ARISApp allows for critical documentation and information to be constantly available via mobile systems. "ARISApp's purpose is to be the digital vehicle for all of our business initiatives now and in the future," said Mr Orr. "It will be the future platform for the entire organisation." Loaded onto the new MIT iPads, ARISApp allows for any and all documentation to be up-to-date and available at all times to any MIT team member. For MIT's trainers, this means that current apprentice sign-up forms, training documentation, progress records, business reports, office administration documentation, government compliance 20 | Motor Trader September 2014
MIT trainers received new hardware and software systems at the trainers' annual conference
“ARISAPP'S PURPOSE
IS TO BE THE DIGITAL VEHICLE FOR ALL OF OUR BUSINESS MOVES NOW AND IN THE FUTURE. IT WILL BE THE FUTURE PLATFORM FOR THE ENTIRE ORGANISATION.”
documentation - everything that might once have required either a trip to the office or the printing out of an email - can now be found at the touch of a button and, if required, completed and returned to the office administration team with the touch of a few more. "We will take all our business processes and facilitate them digitally," said Mr Orr. "This will cut out many steps and also create new ways of doing things. It will also help with the challenges associated with a geographically dispersed workforce, becoming a control point so that everyone is working from the same platform, the same system, the same forms and methodologies.”
And it's not just documentation that will be available to the training team. ARISApp allows for push notifications, instant updates, storage of photo evidence, and a group communication system - meaning trainers can discuss any issue, in real time, with every other trainer, no matter where they are. With a team of 35 trainers spread out across Queensland, the new ARISApp software allows them to take their 'office on the road', reducing paperwork, increasing efficiency and, in the long term, easing the workload on a busy team. Currently in Phase I roll out, over the next few months ARISApp will evolve to include many more features.
Student of the Month, Tyler Brewer
“THE SKILLS HE Dr Glenn Geers, from Australian research centre NICTA, gave a presentation on the future of the motor car
A team from Suzuki made a presentation to MIT's motorcycle trainers
These will include elements available to apprentices - including being able to complete theory work directly into the system and working with ebooks rather than printed material. Employers will see the benefits of the new system too, with improved communication allowing them to have even greater involvement in the development of their apprentice staff. "We will be building an e-learning delivery model that will open up access for students to take part in tests and assessment pieces, and let them have access to all the learning and resource material," said Mr Orr. “There will be a big push towards self-service for students – allowing for transparency for employers to monitor student’s progress as well as allow trainers to see the student’s progress when they are not with them." As well as ARISApp being available through the iPad and iPhone, the new Toshiba hybrid the trainers have been allocated will provide them with additional resources. “The new Toshiba is a portable, flexible productivity tool," said Mr Orr. "It is 4G enabled and is a very flexible system – if the trainers need to print, scan, create a powerpoint presentation or use the Bosch scan tools software system, that’s when the Toshiba comes in." For Paul Kulpa, MIT’s General
Manager Training Operations, the Phase I release of the new IT package is the culmination of many months of work. "We have been studying and discussing learning management systems and e-learning for some time," he said. "At the start of the year we had discussions about how we were going to move forward, and now this development will put MIT at the cutting edge. "The trainers will be the first to benefit but as we move forward over the next 12 months, we will be focusing more on employers and students. "We want to make sure there are no barriers to the learning process." With the new systems now being used by MIT trainers out on the road, development of the new systems will continue and, said Mr Kulpa, will give MIT and MTAQ significant scope for building and developing new business. "We hope to have everything completed by the end of 2016 and, once the system is fully functional, I think we will be asking ‘how did we do this before?’ "It has scaleability, and that’s a great thing for us. There are no boundaries. We could quite easily go to WA and deliver training processes there and it could also work within our MTA Global business, training students abroad. "It is an exciting time for us."
HAS LEARNT HAVE ALLOWED TYLER TO CARRY OUT REPAIRS . . . THAT ARE EQUAL TO, IF NOT EXCEED, A TRADESMAN'S QUALITY AND KNOWLEDGE.”
TYLER BREWER is the Student of the Month winner for August. The 22-year-old, who recently finished his four-year Diesel Mechanic apprenticeship, impressed his MIT trainer, Steve Hudspith, with his work ethic. "Tyler maintained a highly-motivated attitude to both the theory and practical sides of his apprenticeship," said Steve. " And he has taken on other responsibilities too, to help, motivate and remind other apprentices in his workplace of upcoming training appointments." As for Tyler, he has been very busy during his time with employer DA.MET, a diesel engine and transmission specialist based in Brisbane. "I have been hands-on with many diesel engines of all types, using my skills to pull down, inspect and diagnose, as well as order parts and rebuild the engines," he said. "I have dismantled automatic transmissions and rebuilt them and, after each rebuild, I was responsible for testing all transmissions on our dyno to ensure they were working to factory specifications." "The skills he has learnt have allowed Tyler to carry out repairs on heavy vehicle and boat engines, and transmissions," said Steve. "And they are equal to, if not exceed, a tradesman's quality and knowledge." Tyler wins a $50 voucher for Supacheap Auto
September 2014 Motor Trader | 21
E S S E N T I A L S
MTAQ's ICT Manager James Orr introducing the features of the ARISapp software
Trainers receive an update on the latest scan tool diagnostic systems
M E M B E R S
TYLER BREWER WINS STUDENT OF THE MONTH AWARD FOR AUGUST
E S S E N T I A L S M E M B E R S
MIT TRAINER PROFILE
Training matters
MIT CHOOSES BOSCH SYSTEMS FOR TRAINERS W ITH CARS BECOMING more and more complex, with more electronics and computing power packed into every new model, the need to be able to correctly diagnose faults in those systems is paramount. MIT have chosen to supply its trainers with the Bosch KTS570 scan tool - a system that is perfect for its role with MIT where many training scenarios require the use of a diagnostic tool. "50 per cent of our training modules have an element of diagnostic work to them," said MIT Senior Trainer, Marcello Riotto. "That's why we have had a long-term association with Bosch - their name is synonymous with top-end technology." On site at MIT during the recent two-day trainers' conference were Simon Elvidge and Trent Baker, from Bosch, who were installing the latest
JAMES DIXON
The Bosch KTS570
scan tool software onto the trainers' new Toshiba computers. "The KTS570 scans the car's computers and searches for error codes that are logged by faults with components," explained Simon. "What's unique about the Bosch tool is that it contains 'Service Information' that will tell you not only what is wrong with the car but guide you on how to test the components.
2014 TRAINER OF THE YEAR What is your background in the automotive industry?
What do you believe is the most important aspect of training?
Completed my apprenticeship in New Zealand and have been in the automotive industry for 30 years, working and training in many countries around the world.
Tailoring training sessions to adapt to the different learning styles of the students.
When did you become a trainer for MTA Institute of Technology?
The automotive industry is exciting and constantly evolving with different career paths to choose from.
2011.
How does it feel to have been chosen as MIT’s Trainer of the Year for 2014? It's recognition for a lot of hard work and long hours we all put in as trainers.
What is your specialised area? Light vehicle. 22 | Motor Trader September 2014
"An error message may say the oxygen sensor is faulty. But the problem might actually be a hole in the exhaust which is giving a false air reading. "The Bosch KTS570 will check the oxygen sensor, and tell you if the problem needs further investigation. That facility is specific to our top range tools and is what makes it invaluable in the training sector - you're not left in the dark guessing what the problem could be. "The KTS570 also has a built-in multimeter and a two-channel oscilloscope so you can get wave patterns out of injectors and sensors. "It does just about everything and, being a bluetooth system, you can plug the box into the car and walk away to work on your laptop. You're not bound by wires and USB ports." The Bosch KTS570 and upgraded software is now in use across MIT's training team.
What geographical area do you service? East Brisbane.
What is the most satisfying aspect of your role as a trainer for MTA Institute of Technology? Helping the students reach their potential and making the process enjoyable.
Why should someone consider a career in the automotive industry?
What is the best piece of advice you can give to an apprentice? Put your goals in place and work towards them. Be the best at what you do.
When you’re not training, what do you like to do? Work on my vocational education degree.
65TH Annual Motor Trade Golf Tournament NUDGEE GOLF CLUB THURSDAY, 16TH OCTOBER, 2014 Entries close 5pm Friday, 10th October, 2014 with Treasurer David Gorrie, 12 J Dobson Road, Morayfield, 4506. Phone 0431 431 952 Email: gorried@yahoo.com.au Early receipt of entries will determine the priority for allocation of starting times. ENTRANCE FEE: $50 EACH PLAYER, MUST ACCOMPANY THE ENTRY FORM (includes Green Fee, All Competition Events, Halfway Snack and Dinner from 5pm) (Entrance Fee is Non-Returnable) SEE ELIGIBILITY AND CONDITIONS OF PLAY
TROPHIES WILL BE AWARDED FOR THE FOLLOWING:
18 HOLES STABLEFORD – MAIN EVENT MOTOR TRADE CUP: 18 Holes Stableford. Trophy donated by Motor Trades Association of Queensland for annual competition. Winner each year to receive replica and special trophy. Trophies also for second, third and fourth and numerous trophy run-downs. Nearest-the-Pins on all Par 3 holes
18 HOLES STROKE EVENT Trophies for Winner and numerous Runner-up Trophies Nearest-the-Pins
SPECIAL TROPHY FOR HOLE-IN-ONE ON ANY HOLE COMMITTEE: CHAIRMAN: RON SCELLS P.O. Box 49, Boonah, 4310 (5463 2707)
ROSS McCLOUD, 66 Cumberland Drive, Alexandra Hills, 4161 (0419 841853)
TREASURER: DAVID GORRIE, (Life Member) 12 J Dobson Road, Morayfield, 4506 (0431 431 952)
DES KEMPSTER, (Life Member) 46 Streeton Parade, Everton Park, 4053 (3355 0410)
SECRETARY: PAT HELMS, Auto Electrics Australia Pty.
NEAL SPRING, 10 Fairhaven Street, Bridgeman Downs,
Ltd. P.O. Box 226 Archerfield 4108 (0439 723 316)
4035 (3263 5515)
SOME PROCEEDS MAY BE DONATED TO CHARITY
MTAA SUPER CLEARING HOUSE WHAT IS THE MTAA SUPER CLEARING HOUSE? If you are making contributions into multiple funds for your employees, the MTAA Super Clearing House may help to simplify the process. It’s an online facility that allows you to pay into multiple funds with one transaction whilst at the same time meeting the new payment obligations under the Government’s Stronger Super reforms – called SuperStream.
PAYING INTO MULTIPLE FUNDS? That probably means multiple files and multiple payments! Making your payments into the MTAA Super Clearing House will mean one file and one transaction. An employer would upload their data file (or create a contribution return manually online), input their payment and the MTAA Super Clearing House would then distribute payments and contribution details to all the super funds the employer would normally be making separate payments to – both default contributions and choice contributions.
If the employer wants to check that payments have been sent to the other funds, they can log on to the MTAA Super Clearing House at any time.
ARE YOU PREPARED FOR SUPERSTREAM? Many of the Government’s Stronger Super reforms are well underway. Upcoming reforms are focussed mainly on creating a simplified process for the administration of employer contributions. SuperStream is designed to make the administration of super easier and more efficient. It means paying super contributions for your employees online using a format prescribed by the Government. It will save you time and money by allowing all your super contributions to be paid in one transaction – both default contributions and choice contributions. If you have 20 or more employees, SuperStream starts on 1 July 2014, but the ATO will provide flexibility for you on your start date, provided you are making a genuine attempt to
implement and have a firm plan to do so by no later than 30 June 2015. If you have 19 or fewer employees, SuperStream starts on 1 July 2015. As with larger employers the ATO will be flexible provided you have a plan in place by 30 June 2016. The MTAA Super clearing house is a non-cash payment facility issued by Westpac Banking Corporation. It offers a high level of security, stability and privacy and is regulated by the Government as a financial product. You should consider the terms and conditions in the Product Disclosure Statement in deciding whether to use the MTAA Super clearing house, which is available from mtaasuper.com.au/ clearinghouse The MTAA Super Clearing House is accessible free of charge to default or registered employers subject to application criteria. Other employers may be granted use of the service at the approval of the Trustee. For further information on any of the above call us on 1300 362 415 to be put in touch with an MTAA Super representative.
This document is issued by the Motor Trades Association of Australia Superannuation Fund Pty Limited (ABN 14 008 650 628, AFSL 238 718) of Level 3, 39 Brisbane Avenue Barton ACT 2600, Trustee of the MTAA Superannuation Fund (ABN 74 559 365 913, SPIN MTA0100AU). Motor Trades Association of Australia Superannuation Fund Pty Limited has ownership interests in Industry Super Holdings Pty Ltd, ME Bank Pty Ltd and Superpartners Pty Ltd. The information provided is of a general nature and does not take into account your specific financial needs or personal situation. You should assess your financial position and personal objectives before making any decision based on this information. We also recommend that you seek advice from a licensed financial adviser. The MTAA Super Product Disclosure Statement (PDS), an important document containing all the information you need to make a decision about MTAA Super, can be obtained by calling MTAA Super on 1300 362 415. You should consider the relevant PDS in making a decision.
mtaasuper.com.au
An Industry SuperFund
THE INDUSTRY SUPER FUND FOR THE AUTOMOTIVE INDUSTRY.
Follow us on facebook: MTAA Super Pathways for news on careers and employment. Motor Trades Association of Australia Superannuation Fund Pty Ltd (ABN 14 008 650 628, AFSL 238 718) is the Trustee of MTAA Superannuation Fund (ABN 74 559 365 913). You should consider whether or not MTAA Super is appropriate for you. The MTAA Super Product Disclosure Statement (PDS) can be obtained by calling us on 1300 362 415. You should consider the PDS in making a decision.
E S S E N T I A L S M E M B E R S
Member profiles
Automotive Repair Centre Townsville
Mount Isa Harley-Davidson Location: 125 Camooweal Street, Mount Isa
Type of business: Harley-Davidson
dealership
Number of employees: 2 Trading since: 2005 MTAQ member since: 2008
How did you hear about the Motor Trades Association of Queensland? (MTAQ)
What is the best thing about working in your industry?
From industry publications.
Working with an iconic brand and helping make dreams come true.
How has being an MTAQ member benefited your business? Helps to keep us compliant and up to date with consumer and legislative changes.
What has been your proudest business achievement to date? Turning a run down business into a vibrant and viable business.
Royans Brisbane
26 | Motor Trader September 2014
What is the best piece of business advice you have ever given or been given? Come to work every day with a smile and enthusiasm. Look after each customer the way you would like to be looked after.
What would you say to someone thinking about joining MTAQ? The MTAQ has helped us out with technical training, and the updates are priceless.
What is the best thing about working in your industry?
From Andy O’Hearn, the MTAQ Divisional Representative.
The ever-changing technology - it keeps you alert and makes you think.
How has being an MTAQ member benefited your business?
What is the best piece of business advice you have ever given or been given?
The tech support and the regular bulletins are great.
What has been your proudest business achievement to date? Somehow run two businesses 4000km apart – one in Townsville and one in Hobart.
Bite off more than you can chew, and then chew like buggery.
What would you say to someone thinking about joining MTAQ? MTAQ are an important part of our business and you must give it a go.
Mount Isa Harley-Davidson
Royans Brisbane Location: 37 Industrial Avenue, Wacol Type of business: Truck and trailer
accident repair
Number of employees: 40 Trading since: 2000
How did you hear about the Motor Trades Association of Queensland? (MTAQ)
What is the best thing about working in your industry?
Industry publications.
Dealing with a wide variety of customers and suppliers, large and small.
How has being an MTAQ member benefited your business? MTAQ has provided invaluable advice on legislation requirements and keeps us up to date on changes before and as they happen.
What has been your proudest business achievement to date? Growing and restructuring the business to meet today’s demands.
What is the best piece of business advice you have ever given or been given? Try to keep your overheads in check.
What would you say to someone thinking about joining MTAQ? MTAQ is a valuable tool for your business.
September 2014 Motor Trader | 27
E S S E N T I A L S
Location: 317 Bayswater Road, Garbutt Type of business: Mechanical Repairer Number of employees: 4 Trading since: 1995 MTAQ member since: 1995
How did you hear about the Motor Trades Association of Queensland (MTAQ)?
M E M B E R S
Automotive Repair Centre Townsville
E S S E N T I A L S M E M B E R S
Industrial relations
IMPORTANT CHANGE TRAINEE EMPLOYM TED KOWALSKI INDUSTRIAL RELATIONS MANAGER
T
HE QUEENSLAND GOVERNMENT has introduced new legislation, which came into effect from 1st July 2014, and which now governs apprentice and trainee conditions. The new Act is called the Further Education and Training (FET) Act 2014. The most significant change relates to the fact that the Department of Education Training and Employment (DETE) will now focus primarily on the training contract of apprentices and trainees and how completion rates can be improved, while employment issues will be handled by the Fair Work Commission. This means that issues like dismissing an apprentice or trainee will have to be handled in the same way as they are for any other employee ie., a proper warning process will have to be followed prior to any dismissal. Provided you follow the correct procedure when dismissing an apprentice or trainee you will simply advise DETE of that fact and they will leave it to the employer and apprentice/trainee to resolve
any issues arising from the dismissal through the Fair Work Commission. Just be aware, though, that if an apprentice/trainee challenges their dismissal by lodging an unfair dismissal claim, DETE may refuse to cancel the training contract until the claim is resolved. Under the Fair Work Act an employee must have been employed for at least 6 months - if employed in a business with 15 or more employees, and for 12 months - if employed in a business with fewer than 15 employees, before they are protected by the unfair dismissal legislation. This is called the qualifying period. The only exception to this rule is that if an employee is dismissed for a discriminatory reason, like age, sex, marital status, pregnancy, temporary absence due to illness or injury, claiming an entitlement they believe they have etc. Such a claim (called a General Protections Claim) can be lodged at any time – including during probation, but must be lodged within 21 days of the event (dismissal).
MTA QUEENSLAND WELCOMES THE FOLLOWING NEW MEMBERS Business Name
Principal/s
Address
Division
Cricks Caloundra
Garry Crick and John Eastham
13 Caloundra Road, Caloundra Q 4551
Caloundra@cricks.com.au
ARD
Duchess Road Automotive Repairs
Robert Campbell
154 - 156 Miles Street, Mount Isa Q 4825
drautos@bigpond.net.au
AED
Jax Tyres Toowoomba
Jennifer Berlin
330 - 332 James Street, Toowoomba Q 4350
Toowoomba@jax.com.au
TUDQ
Petersen’s Motor Repair QLD
Andrew Petersen
45 Granite Street, Geebung Q 4034
petersensmotorsqld@gmail.com
AED
28 | Motor Trader September 2014
M E M B E R S
SOME FURTHER CHANGES • An apprenticeship/traineeship starts on the day agreed by the employer and the person who is to become the apprentice/trainee. • Applications to extend the training probationary period (90 days for apprenticeships and 60 days for traineeships) must be made to DETE at least 14 days prior to end of probation and cannot be extended past 6 months from commencement. Such applications must be signed by all parties. • To end an apprenticeship/ traineeship during the training probationary period, the party seeking the end of the training contract must provide written notice to the other party; state the date on which it is to end – which cannot be later than the end of the training probationary period; and notify DETE within 7 days of the training contract ending. • The employer must ensure the training contract is signed by the parties within 14 days of commencement. • The employer must take all reasonable steps to ensure the training contract is given to DETE or an authorised Australian Apprenticeship Centre within 28 days from commencement. • The Training Plan must be in the approved form and signed within 3 months of commencement. • The parties may agree to a temporary transfer of the training contract to a new employer for a period of up to one year, but such a transfer must end before the nominal term expires. The original employer must advise DETE within 7 days in the approved form and state: the name of the new employer; date of effect of the transfer; duration of the temporary transfer; and the form must be signed by all
“ISSUES LIKE
DISMISSING AN APPRENTICE OR TRAINEE WILL HAVE TO BE HANDLED IN THE SAME WAY AS THEY ARE FOR ANY OTHER EMPLOYEE.” parties as well as the new employer. • Application can be made to DETE to permanently transfer a registered training contract. The application can be made by all parties to the training contract and the new employer; or by the apprentice or trainee and the proposed new employer. Such applications must be in the approved form and state; the name of the proposed new employer; the proposed transfer date; that the proposed transfer is agreed to by each of the applicants; and the reason for the proposed transfer. DETE will notify the current employer of the application. The current employer may object in writing within 14 days of receipt. DETE must decide the application within 28 days of receiving the original application. If the transfer is approved the apprentice/trainee retains the same registration number. • Parties to a training contract may apply to DETE to suspend the contract for a period of up to one year for reasons like maternity leave; gap year; and a period of extended unpaid leave or sick leave. Applications must be in the approved form and state; reason for the proposed suspension; period of the proposed suspension; proposed date of effect – which cannot be less than seven days from when the application is received by DETE; that the proposed suspension is agreed
to by all parties to the training contract. A party may withdraw their consent for the suspension, in writing, within seven days of the application being received by DETE. • The parties may apply to DETE to cancel a training contract. The application must be in the approved form. A party may withdraw their consent to an application to cancel within seven days after the application is received by DETE. If a party withdraws their consent, the application is taken to have been withdrawn and DETE notifies the parties of the withdrawal and confirms the contract remains active. This would typically be the scenario where an apprentice/trainee has decided to lodge an unfair dismissal claim with Fair Work Commission. • Discipline may be proposed by way of a show cause process when it is found through an investigation that a party to the training contract has either contravened the Act or the training contract or engaged in misconduct. Misconduct can include; a party failing to carry out a reasonable and lawful instruction that is consistent with that party's obligations under the contract; failure to keep a training record prescribed by regulation in the way prescribed by regulation; and failure to produce the training record when requested by another party to the contract or the chief executive (of DETE). The Chief Executive may make an order to; reprimand the party; or direct the party to pay a fine of up to four penalty units. (One penalty unit currently = $113.85). There are no longer any provisions to suspend or cancel a training contract for misconduct. DETE has further information on these changes and provides access to the various forms that are required on their web site www.apprenticeshipinfo.qld.gov.au September 2014 Motor Trader | 29
E S S E N T I A L S
ES TO APPRENTICE/ MENT PROVISIONS
Investment matters
MARKET WRAP
G
EOPOLITICAL TENSIONS REMAINED in focus with the Middle East and Ukraine crises escalating and the European Union agreeing to place sanctions on broad sectors of the Russian economy. The US Federal Reserve tapered its asset purchases by another US$10b to a monthly pace of US$25b, while the European Central Bank left rates on hold following a cut last month, highlighting that they see rates at current levels for an extended period. Recently we have begun to see some better economic news, as data suggests a recovering US and Chinese economy. However this has resulted in markets faltering in response to higher bond yields and anticipations of interest rate rises. This month we ask the question, “Can good news be bad news?” from a market perspective. A key driver of markets over the last year has been very low interest rates. This works in a number of ways to support markets. A lower risk-free rate justifies higher valuations for assets and if the yield on a US 10-year bond offers a yield of 2.5% compared to 6%, equities look attractive. Low interest rates also drive economic activity. A lower cost of debt means company profits improve, as does their willingness to borrow and invest. As a consequence of the support provided by interest rates, it is understandable that the market is keenly focused on the direction of bond yields and interest rates. With quantitative easing set to finish, we can expect an increase in bond yields/ interest rates over the next two years. This has seen the market on occasion interpret “good news as bad news.” If good economic news leads to an expectation of higher bond yields or
30 | Motor Trader September 2014
Better economic news has been coming out of the US, suggesting a recoivering economy
higher interest rates, then it can have a market impact. A meaningful increase in bond yields would most likely see some of the winning trades over the past year or so begin to unravel, in particular high yielding credit, high yielding assets and the A$. Volatility has been low, and a pickup should be expected at some stage that could well be accompanied by a pullback in markets. However, we would see a pullback as a buying opportunity. Downside to markets will be protected by the fact liquidity remains strong. Even if we see a lift in bond yields we still expect interest rates to remain low for some time supporting equities. Noting the differential between equity yields and bond yields is still likely to remain very wide. Additionally a typical bear market does not develop unless a recession or a collapse in earnings is imminent. This is not the case. Corporate earnings are solid while the world economy is stronger.
As such we have been seeking to protect the portfolios from a pullback by remaining disciplined in terms of our quality and valuation focus, and by biasing the portfolios away from those stocks that have benefited from the very low bond yields. DISCLAIMER This document provides general information only and is not intended to be a recommendation to invest in any product or financial service mentioned above. Investment in a Dalton Nicol Reid individually managed account can only be made on completion of all the required documentation. Whilst Dalton Nicol Reid has used its best endeavours to ensure the information within this document is accurate it cannot be relied upon in any way and recipients must make their own enquiries concerning the accuracy of the information within.
News
Pictures courtesy of Bonhams
FERRARI 250 GTO SETS WORLD AUCTION RECORD
This 1962 Ferrari 250GTO Berlinetta is the world's most expensive car sold at auction. It fetched a mind-boggling $US38,115,000
T
HERE ARE PLENTY of expensive cars out there. Brand new supercars and rare classics can cost the price of a decent house with no problem whatsoever. But there is expensive, and then there is REALLY obscenely expensive. And they don’t much more expensive than the 1962 Ferrari 250 GTO Berlinetta that was sold in August at Bonhams’ Quail Lodge Auction in Carmel, California. The Ferrari became the most valuable car in history to be sold at auction when it realized $US38,115,000, surpassing the $US30million set by Bonhams last year with a 1954 Mercedes-Benz W196 R F1 Racer. The Ferrari 250 GTO Berlinetta had been the subject of intense international interest. The car was
the 19th 250 GTO built, completed in September of 1962, and was delivered to leading French racing driver Jo Schlesser. It's racing history saw it involved in a crash during a race near Paris after which it was repaired by Ferrari and sold to gentleman driver Paolo Colombo in time for the 1963 competition season. After a couple more years of racing the car found its way into the hands of
Fabrizio Violati whose family owned the car up until its sale. Bidders from around the world were in attendance in the audience and on the telephones and the auction pavilion was reportedly filled to capacity. The passionate bidding war ended with the audience erupting into applause when the fall of the gavel confirmed the final price. “It’s been a genuine privilege to represent this outstanding car and we are delighted with today’s results,” said Robert Brooks, Chairman of Bonhams. “We’ve always maintained that we would exceed the current world record and that the car would bring between $US30-$US40million and today the GTO did just that.” Other cars from the auction also sold extremely well, recording a combined total of $US65,945,000. September 2014 Motor Trader | 31
News
from the Office of Fair Trading
COMMENCEMENT OF NEW MOTOR INDUSTRY LEGISLATION T HE NEW MOTOR Dealers and Chattel Auctions Act 2014 is expected to commence later this year. The motor industry is currently covered by the Property Agents and Motor Dealers Act 2000, which groups the motor industry with a number of other industries. After extensive consultation with the Motor Trades Association of Queensland and the motor industry generally, the new law reduces red tape for business while maintaining appropriate consumer protections. Perhaps the most noticeable improvement in terms of the day-today business of motor dealing will be the significant simplification of, and reduction in, the number of forms needed for a motor vehicle sale. Currently there are 14 forms, used for the various types of vehicle sale and combinations of consumer rights (such as warranty, guarantee of title and cooling-off period) that go along with them. These 14 forms will be replaced by 3. Most motor vehicle sales will be completed using just 1 form. To assist in a smooth transition to the new legislation, the OFT will transition your existing motor dealer licence or salesperson certificate automatically to an equivalent licence under the new law. If you have an auctioneer licence, this will also transition. If you have changed address recently, please notify the OFT. Other changes to the motor industry under the new law include: Licences and registration certificates Auctioneers will work under 2 new Acts, depending on what is being 32 | Motor Trader September 2014
auctioned. Existing auctioneers will receive both a chattel auctioneers licence and a property auctioneers licence. If you don’t use one of them, you can simply let it lapse. You will no longer be required to prove you are actively trading or provide photographs when renewing your licence or certificate. There is no longer a certificate category for trainee auctioneers.
Appointment provisions Appointment forms have been simplified and reduced in number. You no longer need to nominate an end date for continuing appointment. Appointments can be terminated with a minimum of 30 days’ notice, or less if both parties agree. Transactions You will no longer need to give an approved form for unwarranted vehicles. As a corporate licensee, you will no longer require a licensed director. Conduct You will no longer need to keep an employment register. You will no longer need to display your licence in your place of business. However, it must still be available for inspection upon request. The offence of tampering with an odometer has been amended to clarify that it also an offence to replace the odometer to falsely represent the distance travelled. The former Code of Conduct has been replaced. Its former provisions will reside in the Act and Regulation themselves. For more information about the new law, visit www.fairtrading.qld.gov. au/pamda-split. If you would like to receive updates, you can subscribe to
our free e-newsletter, Smart Business Bulletin and follow us on Facebook and Twitter.
OPERATION ROUND-UP UPDATE
The OFT is responding to industry concerns about unlicensed motor dealing in a major ongoing compliance operation codenamed ‘Round-up’. Since the operation began, OFT has identified over 150 targets for further investigation after comparing records from auction houses, online advertising and information directly from members of the industry. To date, OFT has issued 10 infringements notices, 26 formal warnings and sent 10 compliance advice letters. Typically, OFT is seeing unlicensed dealers buy repairable write-offs, repair the cars to a basic standard and then sell them at a significant profit to buyers unaware of the vehicle’s history. OFT has also identified a number of traders buying repairable and statutory write-offs for export off-shore. These types of traders do need a motor dealer licence, but are often unlicensed. The operation is ongoing and over the coming months, OFT will pursue further enforcement actions, including prosecutions of the more serious offenders through the Courts. Industry self-reporting of suspect practices is an important part of OFT’s arsenal against unlicensed motor dealing. If you are aware of any unlicensed dealers, you can report them to OFT via www.fairtrading.qld.gov.au or use the MTAQ’s Dob in a Backyarder service at http://www.mtaq.com.au/Home/ DobInaBackyarder.aspx. By: Brian Bauer, Executive Director, Office of Fair Trading
Industry insight
HOW POTENTIAL BUYERS LOOK AT YOUR BUSINESS I F YOU WANT to achieve maximum value for your business it pays to look at it from a potential purchaser’s perspective. This is because a seller’s perspective often includes emotion, which has no value to a purchaser. A savvy purchaser will perform a ‘Due Dilligence’ as part of the process. Some aspects of this are:
• Could town planning or major road or public works have an affect? • Is a rezoning application necessary if the business is to move location?
LEGAL AND TAX
BUSINESS ASSETS
• What contracts are in place and are they current? • Are tax liabilities up to date? • Are there legal notices served on the business? • What are the tax implications on the sale/ purchase e.g. CGT, GST etc? • Has the sale agreement been properly drafted and is everything included e.g. assets, escape clauses, ‘sale as a going concern’ etc? • How has the business been valued?
• Are fixed assets included in the sale price listed and what is their book value, market value and replacement value and which is the purchaser paying? • If business is a limited company is the purchaser buying shares or the assets? • If purchaser is buying inventory or work in progress what is the value and will it be adjusted at the time of settlement? • Is the purchaser buying intangibles e.g. contact database, business names, intellectual property, exclusive rights or leases and can they be transferred?
FINANCE • Analysis of financial records and a review of quality, accuracy and results. • Accounts receivable – are they included? • Sales analysis – reliability, bad debts, sales patterns, customer spread. • Sales forecasts – obsolescence, mix, growth potential, minimum/maximum likely, salespeople reliance, current owner trade restriction. • Affect on profit of increased/decreased sales, inflation. • Warranties/refunds potential liability.
LEASES • Is there a premises lease in place and can new owners continue or do they need a new one? • Has it been checked by a lawyer?
STOCK • Is stock turnover comparable to industry benchmark? • Does stock include slow moving items from another business? • Has inventory been valued in Cost of Goods statements? • Has any inventory been sold and not shipped?
COMPETITION
EQUIPMENT
• Is it in a competitive environment and are competitors gaining strength? • Is it affected by the internet and is the industry growing, declining or static? • Is deregulation a possibility?
• Is it in good repair, efficient, in danger of becoming obsolete or difficult to service? • Are parts available and could it be sold easily? • Is equipment depreciated and is it reasonable and based on accounting or tax? • Is any equipment leased and what are the terms and cost of all leases? • Will purchaser get ownership when leases expire and what are residual values?
SUPPLIERS • Will they continue supply and are contracts in writing? • How is the business’ credit rating and will this transfer to the purchaser?
LOCATION • Is it good and are there developments that could affect future business?
EXPENSES • Are all expenses known and will they be the same for a new owner? • Could some expenses have been paid via another business?
• Have expenses been avoided or delayed e.g. equipment maintenance and could this be an issue later? • Are any annual expenses due soon and are there new ones to consider? • Are there maintenance contracts in place, what do they cover and are they paid up to date? • How does the business’ expenses compare to industry benchmarks? • Are any expenses prepaid and are they reimbursable? • Will a purchaser be responsible for corporate body expenses? • Would decreased or increased sales have an impact on costs? • Are costs allocated to individual products/ services and would any change in product/ service mix affect them? • Are there any ongoing regular expenses that a purchaser would need to honour?
DEBTS • Are the assets being sold free of debts or liens and if not what are the terms of repayment? • Are there any contingencies such as warranties, court actions or guaranteed debts or accounts? • Is a purchaser assuming any risk of being liable for a previous owner’s actions? • Will the cash flow from operations be enough to pay costs and obligations? • Is interest paid for money loaned to the business? Much of this information was gathered from a Queensland Government document and as you can see it’s a pretty long list. If you’re planning to sell your business anytime in the future it would pay to put in place a plan to address these issues to avoid having to discount your sale price in compensation. To find out more information on how to improve the value of your business, download our free whitepaper ‘Improve the value of your business’. http://info. cfooncall.com.au/how-to-improve-thevalue-of-your-business. September 2014 Motor Trader | 33
Honda Genuine Plus A Trade Loyalty Program presented by Honda honda.com.au/hgp
Colosseum, Italy
Great Wall, China
Grand Canyon, USA
Pyramids, Egypt
Taj-Mahal, India
Great Barrier Reef, Australia
Machu Picchu, Peru
Each month there will be a prize draw where 5 Coles Group & Myer Gift Cards to the value of $1,000 each are given away. At the end of the 6-month period, all eligible entries will enter into the major prize draw to win Flight Centre Travel Vouchers: 1st Prize – $25,000 Flight Centre Travel Voucher 2nd Prize – $15,000 Flight Centre Travel Voucher 3rd Prize – $10,000 Flight Centre Travel Voucher Already a Honda Genuine Plus member? No need to register again! You will be automatically enrolled in this promotion.
HP1527
Entry to the Competition constitutes acceptance of the Terms & Conditions. The promoter is Honda Australia Pty Ltd, ABN 66 004 759 611, of 95 Sharps Rd Tullamarine VIC 3043. Telephone: (03) 9285 5623. Competition opens at 9am 1/07/2014 and closes at 5:00pm on 31/12/2014. Entry is restricted to registered trade customers who purchase Honda Genuine Parts from authorized Honda dealers in Australia. Entry is based on the purchase values (ex-GST) of Honda Genuine Parts which will be accumulated within 1-month period (in Jul, Aug, Sep, Oct, Nov, Dec 2014) for the monthly prize draws and within 6-month period (between Jul and Dec 2014) for the major prize draw. The prize draws will be held at Honda Australia 95 Sharps Rd, Tullamarine VIC 3043 Australia with an independent witness at 2:00pm on 30/01/2015 for the major prize draw and on the following dates for the monthly prize draws: 21/08/2014, 18/09/2014, 16/10/2014, 20/11/2014, 18/12/2014 and 22/01/2015. The first valid entries drawn will win the prizes, listed in full Terms and Conditions listed at honda.com.au/hgp. The winners will be notified in writing within five days of the draws. The name of winners will be published on honda.com.au/hgp on 04/02/2015 for the major prize draw and on 26/08/2014, 23/09/2014, 21/10/2014, 25/11/2014, 23/12/2014 and 27/01/2015 for the monthly prize draws. Full Terms & Conditions are available from the Promoter on honda.com.au/hgp. Authorised under Permit No: VIC Permit No. 14/4460; NSW Permit No. LTPS/14/04779; SA Licence No. T14/1094; ACT Permit No. TP 14/02103.