
Australian car dealers lose again as court rules in favour of Mercedes-Benz
The Federal Court has dismissed an appeal, filed in 2024, against a judgement it handed down in 2023.
In that ruling, where it found in favour of Mercedes-Benz Australia Pacific over a majority (38 of 50) of its franchised dealers, the Court found dealers hadn't been misled about the agency move and that Mercedes-Benz hadn't engaged in unconscionable conduct.
The Australian Automotive Dealer Association (AADA) said it's "bitterly disappointed" by today's decision, particularly as it follows the Supreme Court of Victoria's ruling earlier this year which found General Motors didn't breach its agreement with Australian dealers when it axed the Holden brand in 2020.
Hundreds of new car deals are available through CarExpert right now. Get the experts on your side and score a great deal. Browse now.
It's pushing for the Federal Government to introduce additional protections for automotive franchisees "so that the blueprint created by this court decision is not used by others".
"We welcome the decision of the Full Court of the Federal Court in this matter. Our focus continues to be on delivering luxury products and services for our valued customers around Australia," said a spokesperson for Mercedes-Benz.
At the heart of the original case, which commenced in October 2021, was the compensation Mercedes-Benz offered to dealers, although Justice Beach indicated Australian franchise law may once again need to be revisited and potentially modified.
"Australian dealers have been fighting to stop Mercedes-Benz using their power over franchised dealers to force them into one-sided business relationships. Today's decision is a significant blow to that fight which will have detrimental effects on Australia's franchising sector," said AADA CEO James Voortman.
"In handing down today's decision, there is now a clear need to protect Australian franchisees against unfair treatment from franchisors to arbitrarily change business models with no compensation.
"The presiding Judge in the original court decision clearly articulated the need for further amendments to the Franchising Code to protect the investments dealers make in their businesses.
"Today's decision confirms that current laws in Australia do not adequately protect new car dealers against unfair conduct and particularly are not being supported against unfair decisions being made in head office overseas.
"It is imperative that the Federal Government moves at speed to implement the commitments it made in the election to protect franchisees against unfair contract terms and unfair trading practices."
The move to an agency retail model resulted in Mercedes-Benz taking ownership of dealership stock, and removing the ability for customers and dealership staff to negotiate on prices – a change which dealers claimed would drive up prices of new models.
At the time of the initial court action, the 38 dealers were pursuing approximately $650 million in compensation.
Mercedes-Benz isn't the only auto brand to switch to an agency model in Australia, with Honda also doing the same – also resulting in legal action from some of its dealers.
Like Honda, Mercedes-Benz experienced a sales downturn after the switch in January 2022.
Deliveries of vehicles from its Cars division fell from 28,348 in 2021 to 26,801 in 2022, before dropping again in 2023 to 24,315 and then 19,989 in 2024.
But there's light at the end of the tunnel, it would appear, with deliveries in the first half of 2025 up 15.9 per cent on the same period last year to 11,146 in total – its best first-half of a year since 2023.
MORE: Everything Mercedes-Benz
Content originally sourced from: CarExpert.com.au
The head of the peak body for car dealers in Australia has slammed a Federal Court appeal decision that found in favour of Mercedes-Benz over dealers unhappy with its move to an agency sales model.
The Federal Court has dismissed an appeal, filed in 2024, against a judgement it handed down in 2023.
In that ruling, where it found in favour of Mercedes-Benz Australia Pacific over a majority (38 of 50) of its franchised dealers, the Court found dealers hadn't been misled about the agency move and that Mercedes-Benz hadn't engaged in unconscionable conduct.
The Australian Automotive Dealer Association (AADA) said it's "bitterly disappointed" by today's decision, particularly as it follows the Supreme Court of Victoria's ruling earlier this year which found General Motors didn't breach its agreement with Australian dealers when it axed the Holden brand in 2020.
Hundreds of new car deals are available through CarExpert right now. Get the experts on your side and score a great deal. Browse now.
It's pushing for the Federal Government to introduce additional protections for automotive franchisees "so that the blueprint created by this court decision is not used by others".
"We welcome the decision of the Full Court of the Federal Court in this matter. Our focus continues to be on delivering luxury products and services for our valued customers around Australia," said a spokesperson for Mercedes-Benz.
At the heart of the original case, which commenced in October 2021, was the compensation Mercedes-Benz offered to dealers, although Justice Beach indicated Australian franchise law may once again need to be revisited and potentially modified.
"Australian dealers have been fighting to stop Mercedes-Benz using their power over franchised dealers to force them into one-sided business relationships. Today's decision is a significant blow to that fight which will have detrimental effects on Australia's franchising sector," said AADA CEO James Voortman.
"In handing down today's decision, there is now a clear need to protect Australian franchisees against unfair treatment from franchisors to arbitrarily change business models with no compensation.
"The presiding Judge in the original court decision clearly articulated the need for further amendments to the Franchising Code to protect the investments dealers make in their businesses.
"Today's decision confirms that current laws in Australia do not adequately protect new car dealers against unfair conduct and particularly are not being supported against unfair decisions being made in head office overseas.
"It is imperative that the Federal Government moves at speed to implement the commitments it made in the election to protect franchisees against unfair contract terms and unfair trading practices."
The move to an agency retail model resulted in Mercedes-Benz taking ownership of dealership stock, and removing the ability for customers and dealership staff to negotiate on prices – a change which dealers claimed would drive up prices of new models.
At the time of the initial court action, the 38 dealers were pursuing approximately $650 million in compensation.
Mercedes-Benz isn't the only auto brand to switch to an agency model in Australia, with Honda also doing the same – also resulting in legal action from some of its dealers.
Like Honda, Mercedes-Benz experienced a sales downturn after the switch in January 2022.
Deliveries of vehicles from its Cars division fell from 28,348 in 2021 to 26,801 in 2022, before dropping again in 2023 to 24,315 and then 19,989 in 2024.
But there's light at the end of the tunnel, it would appear, with deliveries in the first half of 2025 up 15.9 per cent on the same period last year to 11,146 in total – its best first-half of a year since 2023.
MORE: Everything Mercedes-Benz
Content originally sourced from: CarExpert.com.au
The head of the peak body for car dealers in Australia has slammed a Federal Court appeal decision that found in favour of Mercedes-Benz over dealers unhappy with its move to an agency sales model.
The Federal Court has dismissed an appeal, filed in 2024, against a judgement it handed down in 2023.
In that ruling, where it found in favour of Mercedes-Benz Australia Pacific over a majority (38 of 50) of its franchised dealers, the Court found dealers hadn't been misled about the agency move and that Mercedes-Benz hadn't engaged in unconscionable conduct.
The Australian Automotive Dealer Association (AADA) said it's "bitterly disappointed" by today's decision, particularly as it follows the Supreme Court of Victoria's ruling earlier this year which found General Motors didn't breach its agreement with Australian dealers when it axed the Holden brand in 2020.
Hundreds of new car deals are available through CarExpert right now. Get the experts on your side and score a great deal. Browse now.
It's pushing for the Federal Government to introduce additional protections for automotive franchisees "so that the blueprint created by this court decision is not used by others".
"We welcome the decision of the Full Court of the Federal Court in this matter. Our focus continues to be on delivering luxury products and services for our valued customers around Australia," said a spokesperson for Mercedes-Benz.
At the heart of the original case, which commenced in October 2021, was the compensation Mercedes-Benz offered to dealers, although Justice Beach indicated Australian franchise law may once again need to be revisited and potentially modified.
"Australian dealers have been fighting to stop Mercedes-Benz using their power over franchised dealers to force them into one-sided business relationships. Today's decision is a significant blow to that fight which will have detrimental effects on Australia's franchising sector," said AADA CEO James Voortman.
"In handing down today's decision, there is now a clear need to protect Australian franchisees against unfair treatment from franchisors to arbitrarily change business models with no compensation.
"The presiding Judge in the original court decision clearly articulated the need for further amendments to the Franchising Code to protect the investments dealers make in their businesses.
"Today's decision confirms that current laws in Australia do not adequately protect new car dealers against unfair conduct and particularly are not being supported against unfair decisions being made in head office overseas.
"It is imperative that the Federal Government moves at speed to implement the commitments it made in the election to protect franchisees against unfair contract terms and unfair trading practices."
The move to an agency retail model resulted in Mercedes-Benz taking ownership of dealership stock, and removing the ability for customers and dealership staff to negotiate on prices – a change which dealers claimed would drive up prices of new models.
At the time of the initial court action, the 38 dealers were pursuing approximately $650 million in compensation.
Mercedes-Benz isn't the only auto brand to switch to an agency model in Australia, with Honda also doing the same – also resulting in legal action from some of its dealers.
Like Honda, Mercedes-Benz experienced a sales downturn after the switch in January 2022.
Deliveries of vehicles from its Cars division fell from 28,348 in 2021 to 26,801 in 2022, before dropping again in 2023 to 24,315 and then 19,989 in 2024.
But there's light at the end of the tunnel, it would appear, with deliveries in the first half of 2025 up 15.9 per cent on the same period last year to 11,146 in total – its best first-half of a year since 2023.
MORE: Everything Mercedes-Benz
Content originally sourced from: CarExpert.com.au
The head of the peak body for car dealers in Australia has slammed a Federal Court appeal decision that found in favour of Mercedes-Benz over dealers unhappy with its move to an agency sales model.
The Federal Court has dismissed an appeal, filed in 2024, against a judgement it handed down in 2023.
In that ruling, where it found in favour of Mercedes-Benz Australia Pacific over a majority (38 of 50) of its franchised dealers, the Court found dealers hadn't been misled about the agency move and that Mercedes-Benz hadn't engaged in unconscionable conduct.
The Australian Automotive Dealer Association (AADA) said it's "bitterly disappointed" by today's decision, particularly as it follows the Supreme Court of Victoria's ruling earlier this year which found General Motors didn't breach its agreement with Australian dealers when it axed the Holden brand in 2020.
Hundreds of new car deals are available through CarExpert right now. Get the experts on your side and score a great deal. Browse now.
It's pushing for the Federal Government to introduce additional protections for automotive franchisees "so that the blueprint created by this court decision is not used by others".
"We welcome the decision of the Full Court of the Federal Court in this matter. Our focus continues to be on delivering luxury products and services for our valued customers around Australia," said a spokesperson for Mercedes-Benz.
At the heart of the original case, which commenced in October 2021, was the compensation Mercedes-Benz offered to dealers, although Justice Beach indicated Australian franchise law may once again need to be revisited and potentially modified.
"Australian dealers have been fighting to stop Mercedes-Benz using their power over franchised dealers to force them into one-sided business relationships. Today's decision is a significant blow to that fight which will have detrimental effects on Australia's franchising sector," said AADA CEO James Voortman.
"In handing down today's decision, there is now a clear need to protect Australian franchisees against unfair treatment from franchisors to arbitrarily change business models with no compensation.
"The presiding Judge in the original court decision clearly articulated the need for further amendments to the Franchising Code to protect the investments dealers make in their businesses.
"Today's decision confirms that current laws in Australia do not adequately protect new car dealers against unfair conduct and particularly are not being supported against unfair decisions being made in head office overseas.
"It is imperative that the Federal Government moves at speed to implement the commitments it made in the election to protect franchisees against unfair contract terms and unfair trading practices."
The move to an agency retail model resulted in Mercedes-Benz taking ownership of dealership stock, and removing the ability for customers and dealership staff to negotiate on prices – a change which dealers claimed would drive up prices of new models.
At the time of the initial court action, the 38 dealers were pursuing approximately $650 million in compensation.
Mercedes-Benz isn't the only auto brand to switch to an agency model in Australia, with Honda also doing the same – also resulting in legal action from some of its dealers.
Like Honda, Mercedes-Benz experienced a sales downturn after the switch in January 2022.
Deliveries of vehicles from its Cars division fell from 28,348 in 2021 to 26,801 in 2022, before dropping again in 2023 to 24,315 and then 19,989 in 2024.
But there's light at the end of the tunnel, it would appear, with deliveries in the first half of 2025 up 15.9 per cent on the same period last year to 11,146 in total – its best first-half of a year since 2023.
MORE: Everything Mercedes-Benz
Content originally sourced from: CarExpert.com.au
Hashtags

Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles


7NEWS
14 minutes ago
- 7NEWS
House prices break records as rent unaffordably high
After years of rent rises and blocks of land priced out of reach, aspiring home owner Matthew David looked to the sky. The 31-year-old sales worker from Melbourne had dreams of buying a house, but adjusted his expectations to focus on buying an apartment instead. 'It would have been great to have a house, but look, as a single it was just completely unattainable,' he said. 'Apartment living was realistically all that was going to be within aspiration for me.' It's an increasingly common story across Australian cities, with June-quarter data from real estate portal Domain showing all eight capitals had simultaneous house price growth for the first time in four years. Sydney's median house price soared to a record high $1.7 million, while Brisbane, Adelaide and Melbourne medians are above $1 million, according to Domain, and Perth's median house price grew above $950,000. Unit prices experienced their strongest quarterly growth in two years, jumping to a national median price of $689,588 and record highs in four capital cities in the Domain data for the June quarter. Unaffordably high rent was the catalyst for David knuckling down to save for his apartment, with his previous one-bedroom rental jumping to almost $500 a week. 'What I was paying in rent plus what I was saving was actually less than what the mortgage repayments were going to be,' he said. Limited housing supply is driving prices higher, Domain research and economics chief Nicola Powell says, with the market continuing to outperform expectations despite cost-of-living pressures and economic uncertainty. 'We're still not building fast enough to meet population growth,' she said. 'Without a substantial boost in new housing, price pressures will remain, regardless of further rate cuts.' Rental supply is a major concern, with property analyst Cotality observing the number of listings is about one-quarter less than the five-year average. Rents rose 1.3 per cent nationally over the June quarter and remain unaffordable for many tenants, according to the company's economist Kaytlin Ezzy. 'While the moderation in the pace of rental growth is welcome news to many tenants, rents are still increasing,' she said. Rents have jumped more than 40 per cent in the past five years to reach a national average of $665 per week according to Cotality. That equates to almost $200 more per week and more than $10,000 a year and is well below the 15 per cent rise in average wages during the same five-year period. Many home buyers are also under the pump, according to Roy Morgan research showing mortgage stress affecting more than 28 per cent of households in the June quarter. This figure is higher than when the Reserve Bank started cutting rates in February, which Roy Morgan attributes to increased borrowing by purchasers and larger amounts owing on homes overall.

Sky News AU
3 hours ago
- Sky News AU
Funeral held for backpacker killer
Ooops, an error has occurred! Please call us on 1800 070 535 and we'll help resolve the issue or try again later. The Streaming Subscription provides Australians access to top rating opinion shows, award-winning political coverage, live breaking news, sport and weather, expert business insights and groundbreaking documentaries across four dedicated news channels for $5 a month. This includes: Sky News – Australia's news channel featuring award-winning journalists, insights from the biggest names in opinion, ground-breaking special investigations, and live breaking news, sport and weather. Available live and on-demand. Sky News Extra – A dedicated 24/7 channel featuring live press conferences and Parliament broadcasts, with unfiltered access to Australian democracy in action. Available live. Sky News Weather – Australia's only 24/7 weather channel bringing you the latest weather forecasts from the country's largest team of meteorologists. Available live. FOX SPORTS News – Australia's only 24/7 sports news channel, first and live in breaking sports news. Available live. Stream Sky News channel shows in full live and on-demand on or the Sky News Australia app and cast to your compatible TV. For the best streaming experience, stream your favourite Sky News shows on your compatible Smart TV. For a step-by-step guide on how to sign in on your Smart TV or to find out if your Smart TV is compatible, visit our help page. There is no lock-in contract when you subscribe to a Streaming Subscription. Renewals occur automatically unless cancelled as per full Terms and Conditions . The Streaming Subscription is not available outside of Australia. If overseas (excluding New Zealand), you can access your favourite Sky News Australia programs by signing up to Australia Channel. Sky News Australia's international 24/7 news streaming service. Find out more here. You can continue to access digital-only content, video highlights, and listen to the latest podcasts without a subscription on our website and app. The Streaming Subscription gives subscribers live stream access to unrivalled news and opinion content across four dedicated news channels 24/7.

Sydney Morning Herald
3 hours ago
- Sydney Morning Herald
Aussie dollar hits eight-month high as shares slide; Macquarie down, Fortescue jumps
The heavyweight miners were mixed, with BHP down 0.6 per cent, South32 down 0.6 per cent, but Rio Tinto up 0.3 per cent. Santos slipped 1.4 per cent and Boss Energy fell 6.4 per cent, one of the day's worst performers. The lifters Healthcare was the only sector in the green, up 1 per cent, with CSL 1.5 per cent stronger. Clarity Pharmaceuticals surged 10.2 per cent, Neuren Pharmaceuticals 9 per cent and Mesoblast 8 per cent, three of the strongest performers. Three of the big four banks finished higher. NAB added 1.2 per cent, Westpac gained 0.5 per cent, Commonwealth Bank – the biggest stock on the index – rose 0.1 per cent. ANZ fell 0.4 per cent. Mining giant Fortescue, chaired by billionaire Andrew Forrest, jumped 4.3 per cent after it revealed on Thursday it had shipped a record volume of the steel-making material iron ore from its mines in Western Australia in the year to June 30. Despite an economic downturn cooling demand from steel mills in China, by far the biggest buyer of Australian iron ore, Perth-based Fortescue said it had shipped 55.2 million tonnes of iron ore in the three months through June, taking its full-year volume to an all-time high of 198.4 million tonnes. Pexa Group soared 16.5 per cent to a nearly three-year high of $15.09 after the digital property exchange announced leading UK bank NatWest had agreed to facilitate future remortgages on Pexa's platform. The lowdown The local sharemarket lost ground after slightly hawkish comments by Reserve Bank governor Michele Bullock, while the local currency climbed to an eight-month high. Bullock reiterated the bank's gradual monetary tightening in recent years was aimed at getting inflation under control without causing unemployment to rise excessively. Tightness in the labour market was a key concern of Australia's central bank as standing in the way of more rate cuts, but conditions were easing in line with expectations, Bullock said in a speech to the Anika Foundation. A 'measured and gradual' approach to policy easing was appropriate, Bullock said, adding that labour demand remained strong while core inflation was easing gradually. Loading NAB head of market economics Tapas Strickland said the speech leaned slightly hawkish and showed that an August rate cut was not a done deal. A second-quarter inflation readout that will be released on July 30 would be important, he said. Bullock's remarks led three-year government bond yields to extend gains, adding about 3 basis points to trade at 3.48 per cent. That's a 7-basis-point increase on the day. The Australian dollar also extended gains to be 0.3 per cent higher Risk currencies, including the Australian dollar, had benefited from a risk-on tone overnight as trade tensions eased, said NAB economist Pat Bustamante. Loading Financial markets are betting the Reserve will cut two more times this year while paring back the probability of a third reduction to 40 per cent, down from 76 per cent on Wednesday. Markets were paying close attention to various tariff negotiations, and global equities continued their rally as bulls drew fresh conviction from signs the US may strike more trade deals soon after clinching a pact with Japan. Overnight, US stocks set more records. Shares jumped in Tokyo, where the Nikkei 225 rallied 3.5 per cent after Trump announced a trade framework that would place a 15 per cent tax on imports coming from Japan. That's lower than the 25 per cent rate that Trump had earlier said would kick in on August 1. 'It's a sign of the times that markets would cheer 15 per cent tariffs,' said Brian Jacobsen, chief economist at Annex Wealth Management. 'A year ago, that level of tariffs would be shocking. Today, we breathe a sigh of relief.' Locally, the federal government on Thursday revealed it would lift biosecurity restrictions on US beef as it seeks a way to dampen the blow of Trump's volatile tariff regime. Cattle producers were left blindsided by the decision, even though the level of US product arriving in Australia is expected to be very low. It has been suggested Australia will use the easing of rules to argue its case for the US to wind back 50 per cent tariffs on steel and aluminium and Trump's threat to impose a 200 per cent tariff on pharmaceuticals. Agriculture Minister Julie Collins said the decision was a purely scientific one. Trump in April singled out the beef trade disparity with Australia after Australian beef exports to the US surged last year, reaching $4 billion amid a slump in US beef production.