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Q3 2016: Partnerships and Technology Signal the Beginning of a New Era

While some of the issues from earlier this year continue to hold the attention of the industry, partnerships and technology took on a large role this quarter following numerous developments.



The biggest talking point still concerns Volkswagen, which has plunged into legal disarray around the world. Numerous governments have now taken action against the auto-maker for its Dieselgate saga, while locally a class action was instigated and the ACCC took the company to court.

Volkswagen have argued the local government is delaying them from implementing fixes to Australian-delivered vehicles, while the Federal Court cited frustration with the way the manufacturer is cooperating with proceedings. In August, Volkswagen’s operations were further impacted after contractual disputes with its suppliers in Germany and Brazil.

Brexit has resulted in several manufacturers weighing their ongoing operations within the UK, illustrated most by the Japanese government issuing strong advice concerning its contribution to the UK economy.

July 29 marked the final local production run of Ford Falcons, which was recently followed by engine production ceasing on September 26. For now, Holden will shut its engine plant in December this year, a year ahead of the scheduled conclusion of the Commodore range.

Numerous partnerships were also forged during the quarter. Ford signed an agreement with ridesharing business Carhood, which offers motorists free airport parking in exchange for renting out their vehicle. Apple was rumoured to be in discussion with McLaren regarding an acquisition, however this was later denied. Autonomous vehicle partnerships included Volvo and Uber, as well as Hyundai and Google, while Volkswagen will partner with Chinese company Anhui Jianghuai Automobile to develop electric vehicles in China.


Safety and Environment

Driverless vehicles encountered their first major hurdle during June, with one of Tesla’s vehicles involved in a fatal accident after it was unable to distinguish between a white truck and brightly lit sky.

The AAA announced that it would begin to conduct real-world testing for vehicle tailpipe emissions, coinciding with research from Beyond Zero Emissions, which illustrated the potential for a 6% reduction in greenhouse emissions if all Australians converted to 100% renewable electric vehicles. Supporting the momentum were reports that state governments may soon offer motorists’ incentives to take up renewable electric vehicles, with the federal government also mulling whether to scrap the Luxury Car Tax for such cars.



Despite Tesla’s autonomous vehicle incident, manufacturers still continue to make preparations for self-driving vehicles. Just one example, BMW, in partnership with Intel and Mobileye, are aiming for a 2021 release. Framework preparations are also under way around the world – Australia’s current road network is being mapped for machine-reading; black boxes will be required for such vehicles in Germany; and the US released driverless vehicle safety guidelines.

Meanwhile, other technology developments during the quarter included:

  • Honda developing a car that can detect a driver’s emotions
  • Hyundai and Toyota pushing for hydrogen technology within Australia by 2018
  • Airbus assessing the viability a flying vehicle
  • Audi are currently looking into: in-car Wi-Fi; electric vehicle sales being 25% by 2025; vehicles that communicate with traffic lights; and energy recuperating shock absorbers
  • Infiniti unveiled the world’s first market-ready, variable compression ratio engine
  • The first driverless bus was unveiled in Perth in late August

Audi led the way with innovative technology this quarter

Regulatory Issues

Locally, the NSW government made the controversial decision to boost its support of E10 petrol, which has thus far failed to gain any material traction within the market.

At a broader level, the government’s plan to tackle emissions through stricter standards have led motoring groups to caution drivers about the prospect of cost increases associated with new cars.

Lastly, legal and motoring bodies made renewed calls for the introduction of “lemon laws” to protect new car buyers.