COMMENT: We can’t say we weren’t warned.
Australian car executives have said for years that there were too many brands in Australia fighting for increasingly thin slices of the industry pie.
From the declaration by Mitsubishi’s Shaun Westcott that the car industry faced a “bloodbath … not everybody will survive” to Nissan’s Andrew Humberstone’s warning Australian competition was “insane”, Honda’s Jay Joseph forecasting “consolidation and collapse” or Toyota’s Sean Hanley urging people do “do their research” before committing to a new brand, several Australian automotive executives predicted there were tough times ahead.
It’s why Ford’s global boss Jim Farley says Australia is “ground zero” for China’s expansion into the car industry.
And the dominoes are starting to tumble.
Two Australian electric vehicle importers struck trouble within three days last week.
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Ford F-150 Lightning importer AusEV went into receivership on March 17, while XPeng importer TrueEV appointed external administrators on March 19.
It’s evidence of the cutthroat competition within the car industry.
From a distance, it appeared AusEV’s converted electric Ford F-150s were doomed to fail, initially priced from a staggering $224,990 plus on-road costs.
Alarm bells rung as it slashed prices to $109,990 this year.
When Ford’s Detroit headquarters decided to stop building the electric F-150, the gig was up.
The Australian EV distributor published a notice online explaining that Ford’s decision to stop making electric F-150s “materially impacted the availability of the underlying platform the business relied on”.
The tough news for customers is that AusEV and BossCap are “unable to undertake warranty repair works”, leaving customers vulnerable to complex cars that could leave them stranded.
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XPeng owners have similar concerns surrounding a 10-year warranty offered by the brand.
A court battle between the Chinese manufacturer and its independent Australian importer over the future of the XPeng will play out in coming months.
In the same way BYD was imported by Australian group in EVDirect before the company’s head office took over local operations, XPeng could become a centrally managed outfit.
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This isn’t uncommon. Brands ranging from Volkswagen to Ferrari were distributed in Australia by third-party companies such as Inchcape and ATECO before their head offices established local subsidiaries.
But XPeng customers remain concerned by parts supply, warranty arrangements and reported delays surrounding a $5000 cashback incentive.
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A peek at social media communities for the brand shows a variety of customer concerns including “My $5k cashback is now five weeks overdue”, “My 7 month wait for parts may have just got longer”, “RIP 10 years warranty”
and people concerned by court action asking “how this will affect the five years’ free servicing” offered by the brand.
Customers talk about “limbo and uncertainty”, concern “things will be quite messy” and confide that they were “worried from day one about service and parts”.
It’s why Prime Minister Anthony Albanese warned manufacturers not to cut corners on customer support during a speech to car dealers last week.
Mr Albanese said that although “we want Australians to be able to choose from the broadest possible range of vehicles and manufacturers at the best possible price … We want to make it clear to companies new to the Australian market that they also have to meet standards around service, not rely on volume alone”.
