COMMENTS ON THE OPTIONS DISCUSSION PAPER 2014 REVIEW OF THE MOTOR VEHICLE STANDARDS ACT 1989

PREPARED BY TRANSPORT FOR NSW

OCTOBER 2014

Introduction

Transport for NSW (TfNSW) welcomes the Review of the Motor Vehicle Standards Act 1989. This Review provides the opportunity to improve the efficiency and effectiveness of the Act. Any changes to the Act must ensure ongoing improvement of vehicle safety and air quality, two issues dependent on the standards applied to the motor vehicle fleet.

The following are comments on the paper 2014 Review of the Motor Vehicle Standards Act 1989 (the Paper), released by the Commonwealth Department of Infrastructure and Regional Development (DIRD). These include general and specific comments, and questions are identified where the comments relate to a specific question posed in the Paper; and examples are used to support the comments where appropriate.

Overall, TfNSW believes thatto address issues of differing standards, the preferred approach would be the adoption of equivalent UN Regulations. This approach minimises risks in terms of appropriate safety standards and creates greater certainty for importers.

General Comments

  • There is a lack of clarity around the scope of the Motor Vehicle Standards Act 1989 (the Act). The Act applies to road vehicles supplied for use intransport in Australia. However,road is not defined in the Act and associated Motor Vehicle Standards Regulations 1989. (The term road vehicle is defined and it makes reference to “public roads”, yet “public roads” are not defined.) This causes some conflict with state and territory legislation, whose scope extends to “roads and road-related areas”, which includes some off-road areas such as footpaths and certain unsealed roads. This suggests certain lightweight vehicles that do not meet specified Australian Design Rules (ADRs) can be imported and supplied to the market if they are intended to be used on footpaths, yet they are prohibited from being used under applicable state and territory regulations.

An example of problems caused by this lack of clarity is the widespread importation of electric bicycles with power output in excess of the maximum 200 watts (250 watts for pedalecs) permitted for power assisted pedal cycles. These are being imported because they are considered to be mountain bikes for use on off-road trails rather than road bikes, and the Act does not apply to them. This fails to recognise that in NSW and other jurisdictions, many off-road trails are deemed to fall under the definition of a “road-related area” and are covered by road transport legislation. Also, it is highly unlikely that such bicycles will be used exclusively on trails and will frequently be used on sealed roads, if only travelling to-and-from the off road tracks.

Consideration of non-road vehicles should be coordinated with development of the National Agreement on Clean Air, which is also considering options to manage emissions from non-road vehicles.[1]

  • Safety and health outcomes must be at the forefront of any changes to the Act and associated regulations and standards. The recent draft report produced by Austroads Assistance with the 2014 Review of the National Road Safety Strategy (NRSS) identified breakthroughs in vehicle safety as the “major success of the strategy” in reducing the national road toll over the previous 15 years. This significant contribution to road safety must be maintained.
  • There is also a clear need to continue to implement more stringent emissions standards as they are introduced internationally to protect NSW and Australian residents from harmful air pollution.Health costs of PM10 (particles less than 10 micrometres in diameter) emissions from road transport in Australia have been estimated to be $2.7 billion per year.[2]Attachment A provides further detail of the health benefits of vehicle standards and air quality.
  • With light vehicle manufacturing ending in Australia in 2017, there is likely to be a demand from certain industry sectors and members of the public to open the Australian market up to used vehicles imported from overseas. Vehicle safety and emission standards must not be compromised by this increased demand, and the same standards must apply to all vehicles entering the Australian market.
  • An important development since the Act was first introduced and last reviewed is that the DIRD has greatly reduced the amount of Single Uniform Type Inspections (SUTIs) it carries out on vehicles before they are granted approval for supply to the Australian market. Previously, SUTIs provided a degree of assurance that the vehicles do comply with the applicable ADRs, but there is now a reliance on self-certification by vehicle manufacturers. This provides a higher likelihood of non-compliance and associated road safety risks, and vehicle recalls to help rectify subsequent problems that become manifest after the vehicle is supplied to the market.
  • The suggestion that vehicle standards are primarily responsible for the significant increase in vehicle safety and corresponding reduction in the national road toll needs to be qualified. In fact, a number of reports (such as the one resulting from the 2009 Victorian Government Parliamentary Committee’s Inquiry into the Process of Development, Adoption and Implementation of the Australian Design Rules) have found that the Act and associated ADRs have in some instances hampered advances in vehicle safety due to the time it takes to introduce a new ADR or update an existing one. Instead, many of the significant new safety features have been introduced by the vehicle manufacturers, and others have been driven by non-regulatory processes such as the Australasian New Car Assessment Process (ANCAP). For example, the introduction of electronic stability control (ESC) into the ADRs ahead of the European regulations is primarily due to ANCAP making it a prerequisite from 2008 for vehicles to be fitted with ESC to be eligible for its maximum five-star safety rating.
  • A fact that the Paper overlooks is that sometimes the same model vehicle is manufactured in different countries for different markets, and they are manufactured to the standards, practices and materials applicable for each particular area. This can mean that ostensibly the same model vehicles may have been built to different standards depending on their place of manufacture. This problem was highlighted recently when a number of European models that had achieved the maximum five-star EuroNCAP safety rating and which were built in South America achieved safety rating as low as one star when subjected to same assessment tests by Latin NCAP. This suggests that great care is required to ensure vehicles entering the Australian market have been sourced from the same manufacturing base as those that were subject to the Identification Plate Approval process.
  • Australian safety standards should be harmonised with United Nations Regulations. The Paper provides alternatives to adopting international vehicle standards (UN Regulations) either in total to replace the equivalent ADRs, as an addition standard, or by incorporating selected parts in the ADR. Of these options, adopting equivalent UN Regulations holus bolus gives clear specifications, avoids the possibility of mandatory safety features prescribed by a UN Regulation not being required for Australian vehicles, and provides assurance that vehicle models manufactured to UN Regulations can be imported into Australia without incurring modification costs. This also reduces the risk of vehicles being imported from locations that have lesser safety standards. The UN Regulations are global standards and as such, an importer will be able to obtain the vehicles from an appropriatesource.

Specific Comments

P 5, Reduce the barriers to the importation of second-hand quality vehicles and personally imported vehicles

It is recommended that any consideration of measures to reduce barriers to used vehicle imports be supported by analysis of potential increases in the average age of the fleet, and resultant increases in vehicle emissions and health costs.Reducing the barriers to the importation of second hand vehicles into Australia will potentially conflict with the aim of reducing the overall age of the Australian fleet as a whole. It could also affect the overall safety of the fleet as vehicles will be supplied to the market with in many cases outdated safety features.

Any measures to allow importation of used vehicles would need to prevent the importation of older, higher polluting vehicles which would increase future urban pollution and associated health and productivity impacts on the community.

International experience, for example in New Zealand, has demonstrated that imports of second hand vehicles can slow the rate of decrease of harmful air pollutants.[3] New Zealand subsequently introduced emissions standards for imported used vehicles.[4]

Any scheme that potentially increases importation of used heavy diesel engines should require that the engine meet the same standards as required in Australia for new heavy diesel vehicles, with those standards becoming more stringent as Australia harmonises with international vehicle standards. This could be achieved, for example by limiting imports of used heavy diesel to vehicles less than 3-4 years old.

P5, Consolidate concession scheme arrangements

It is anticipated that minimising interaction with the regulator could result in the jurisdictions policing imported vehicles that are later found not to meet the specified requirements.

P7, Introduction

As the Act is concerned with the supply of new vehicles and imported vehicles first supplied to the market, it is unclear why personal imports – i.e. vehicles previously owned by persons overseas and imported into Australia for their own use – come under its scope.

P7, Introduction

Although 2% may comprise a small proportion of the 1,158,608 vehicles supplied to the Australian market in 2012-13, it still means close to 23,000 non-standard vehicles that are entering the Australian fleet. These represent a considerable road safety risk if the applicable safety standards are reduced. This risk is compounded in jurisdictions where a higher proportion of these non-standard vehicles are registered.

P8, Introduction

There is some debate on the status of the numerous procedures and guidance documents, including Administrator’s Circulars and Vehicle Standards Bulletins, and it is important that this is clarified. Circulars are usually produced to clarify an ADR rather than amending it, but there is some evidence that when these have been challenged, they have been ruled to be advisory rather than binding. Also, many of the Vehicle Standards Bulletins (VSBs) are given no status under the Act and are not recognised by DIRD, but are used by the jurisdictions to support vehicle standards under their regulations.

An example of the former is trying to enforce some basic rules for campervans and mobile homes. Rather than make some simple amendments to ADR 44/02 Special Purpose Vehicle Requirements, the DIRD relies on determinations made in its Circular 0-4-12 Certification of Campervans and Motorhomes. However, this has been challenged on a number of occasions. Regarding the second point, important VSBs not recognised by the DIRD include VSB 5 Manufacture and Installation of Seats and VSB 14 National Code of Practice for Light Vehicle Construction and Modification.

P8, Introduction

The relatively high regulatory burden and associated compliance costs borne by the DIRD in administrating imported vehicle schemes needs to be viewed in conjunction with the similarly high costs incurred by the jurisdictions in managing vehicles that were imported that did not meet the conditions of the schemes, including not complying with specified minimum safety standards, either through incorrect information supplied by the importer or concessions given to the importer. A particular problem associated with these vehicles is the fact that once the vehicles are imported into Australia, they become the responsibility of the registering authority. DIRD must ensure that any increase in the number of vehicles being imported under these schemes are supported by the necessary resources to ensure there is not an associated increase in non-complying vehicles being presented for registration.

An example of this problem concerns the Nissan Elgrande, a vehicle sold overseas as a people mover. The vehicle has not gone through the Identification Plate Approval process, so has never been supplied to the Australian market as a new vehicle. Despite this, a considerable number of used Elgrandes have been imported into Australia by exploiting a rule for importing campervans. Few, if any, are used as campervans, and they are invariably used as people movers although they do not meet certain safety standards that apply to this category of vehicle. This has resulted in jurisdictions trying to enforce these standards, but there is clear evidence that they are ignored as the supplier alleges they are sold as campervans. There are numerous other examples of individuals seeking to have non-complying vehicles registered by an authority.

P11, The Australian Motor Fleet

The Paper makes a number of references to vehicle fleets in comparable countries, but it is unclear what these countries are and why they are comparable. Indeed, it is debateable that some of the countries listed as having comparable fleets are actually comparable, such as the UK and Japan as these both continue to have major vehicle manufacturing bases.

P15, Risks and costs to the community: vehicle safety, environmental performance and anti-theft

The effect mandating vehicle standards has had on road safety is debatableas many of the improvements in vehicle safety have occurred well in advance of changes to the standards either through market forces or non-regulatory schemes, such as ANCAP.

P18, Is there a problem?

Whereas it was a considerable road safety achievement for Australia including the important safety feature ESC in its vehicle standards ahead of even Europe, it cannot be ignored that this was largely driven by ANCAP requiring ESC for a vehicle to be eligible for its maximum five-star safety rating since 2008. Similar requirements by ANCAP for light commercial vehicles, and supported by some major industry stakeholders, have yet to be incorporated in the standards, but this has not prevented ESC becoming more prevalent in these vehicles.

In fact, this can be seen as an indication of an essential problem in effectively administering the Act and associated ADRs as it can take a considerable amount of time to develop a new ADR and even to amend a current one. As such, what were emerging vehicle safety features technologies can become either commonplace or obsolete by the time the necessary mandatory standard is enacted.

By way of example, a comparatively basic amendment to the definition of power assisted pedal cycles in the ADRs took over two years to complete, despite requiring no regulatory review to implement and the necessary research that underpinned the change being done previously by another party.

P25, Conformity and compliance

The scope of the Act means that once a vehicle is imported into Australia, it falls under the scope of the legislation administered by the registering authorities in the states and territories. As outlined above, this can cause problems to the registering authorities if vehicles do not meet the applicable safety standards. Expanding the places from where vehicles are sourced, increases the risks of their not having comparable conformance and compliance arrangements, which would increase the burden on the registering authorities in dealing with them.

P27, Near new used vehicles built to a comparable international standard

The condition and history of used vehicles is a very important factor for jurisdictions that operate restrictions on vehicles provisional drivers are allowed to drive. Currently, all vehicles with a power-to-mass ratio greater than 130kW/tonne are deemed “high performance” and provisional drivers cannot drive them. Vehicles with certain engine modifications are also prohibited. The power-to-mass ratio of used imported vehicles must be available, and evidence provided that individual vehicles have not been modified to exceed the 130kW/tonne limit, or otherwise modified to render them prohibited.

P29, Option 1

[7-2]This option fails to identify that the manner in which the Act is administered has changed since it was introduced. In particular, the DIRD no longer carry out widespread SUTIs on vehicles as part of the Identification Plate Approval process and before they are allowed to be sold in Australia.

P30, Option 2

[7-3]The states and territories already spend considerable resources dealing with the non-complying vehicles that enter the Australian fleet. It would be very difficult to envisage them “filling the vacuum” that would be created by repealing the legislation without considerable legislative changes and additional resources. Apart from the problems identified in the Paper, individual vehicle owners are likely to experience difficulties in registering their vehicles if they relocate to a different jurisdiction.