Shades of grey enter industry
AUSTRALIAN boat owners are being warned of the potential safety and financial risks attached to “grey” (or parallel) imports.
The Outboard Engine Distributors Association (OEDA) released a statement voicing concerns about the increasing number of outboard engines that are being imported into Australia outside the outboard manufacturer’s authorised dealer networks – leaving buyers exposed.
“What’s happening is that people are finding great deals, usually via the internet, on engines which are being brought in from overseas,” said OEDA executive officer Lindsay Grenfell.
“Deals that look too good to be true usually are,” Grenfell said.
OEDA said its primary concern is customer safety.
Authorised dealers conduct extensive pre-delivery programs, using specialised diagnostic equipment, to ensure all engines are properly prepared and work as they should. They also ensure engines are fitted correctly to the boat.
“We don’t want people taking their family to sea with engines which could have come from anywhere and which haven’t been properly checked. There could be any number of serious issues,” Grenfell said.
Similarly, if a manufacturer ever identified an issue with a particular model or type of engine, those owners not registered with an authorised dealer could easily miss the recall or update, leaving their engine and themselves at risk.
“The other problem is engines imported on the 'grey' market are not covered by a manufacturer’s warranty which means if the engine dies or falls apart there is absolutely no comeback – no repairs, no replacements, nothing.”
The situation is a grave concern for OEDA, which represents marine outboard engine manufacturers.
“OEDA is urging anyone who’s looking to buy an engine to ask a lot of questions to make sure they are buying from an authorised dealer who will be doing everything to ensure your safety.”
Haines Suzuki also released statement warning consumers off the purchase of grey imported motors.
Suzuki Marine Australia said it has received a substantial number of phone calls from those who have purchased Grey Market items, who have experienced problems due to the many unknowns associated with these products.
The statement reads:
The standards of storage and transport are highly questionable, and there is also the possibility that the item is refurbished. Products not purchased through one of our Authorised Suzuki Resellers cannot be covered by our Australian Warranty and we cannot provide free technical support or warranty repair to purchasers of these engines.
One of the most important of the below points is that the motors that we sell are C-Tick compliant and labelled as such, and therefore meet the standard as required by Australian law. Unfortunately, we have noticed the recent importation of Suzuki outboard motors by private importers or grey importers. Unless you see the C-Tick label on the motor, then you cannot be sure that the motor is C-Tick compliant with Australian law and this may be a problem for you if you make an insurance claim. You should make your own investigations with your insurer, if you feel necessary.
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Interesting comments from "Nato". Please explain what you mean by "OEDA taking aim at the public, when it is them that create the problem"? What does this mean, sorry maybe I am dumb but I don't get what you are suggesting?
B.Knags on 05-Jun-10 08:35 PM
On a whole I agree with Stuarts comments. Within the marine indusrty this problem is epidemic particularily on lower/mid priced items like water ski equipment. As a retailer who depends on local support it is frustrating to constantly here the suppliers like OEDA (a grup of engine manufacturers)aimlessly taking fire at the public, when it is them that create the problem Can you blame the consumer (who is familiar with the product)buying a product overseas for $1500 which retails locally for $2500?
Nato on 04-Jun-10 10:15 AM
I am no economist but in response to Stuarts comments... world wide pricing does exist. We do not have one global economy which is why there is a fine balance of exchange rates. Europe tried to combine currency with the Euro but do you think a loaf of bread cost the same in France as it does in Spain? If i get a new outboard i will get it from my local dealer, not just to support Aussie economy but because it will need servicing at some stage and i want to be looked after. Engines rub metal on metal and sometimes things go wrong. A warranty is worth a lot more than a couple of thousand.
Richard Shunnery on 02-Jun-10 10:27 AM
In my opinion grey imports have helped our industry. Let us all face the facts the OE outboard importers have been gouging enormous margins out of their products for years. As we all know they have left little or low margins for us dealers, in addition they have constant stock issues. In addition to the price savings grey imports have flourised due to these issues. Our company with two franchises have been forced to source over a dozen engines in the last three months just to fulfill clients orders where we have been let down by the OE importers lack of stock. Also lets be blunt- who among us can honestly say they like, respect and appreciate there outboard supplier. We all put up with there dictatorial style and arrogance so we can survive- but when we are forced to sell a engine and make peanuts the grey imports who offer a much greater margin and stock flown in within days is realistically an option. What amazes me is how the grey importers can sell and deliver to me a engine flown in from the USA cheaper and most importantly quicker than the local importer can. I think the flourishing grey imports raise the question of how the entire industry operate. I think there needs to be a revolution in the industry. I believe the OE importers have to reasses their margins, they have to reasses their stock levels and dealer numbers. In the words of the democrats 'keep the bastards honest' the grey imports is starting to do this. Let us support more grey imports and keep the bastards honest.
Nick on 02-Jun-10 09:55 AM
Welcome to our world. We in the Marine Electronics industry have been suffering from this problem for many years now with no solution in sight.
Jim on 02-Jun-10 08:23 AM
Fortunately or unfortunately the internet has made the world a very small place. Until manufacturers recognise this fact and create world pricing structures Grey marketing will continue to be a problem. If one can save thousands of dollars on a particular item, thats a huge incentive to purchase. Potential warranty issues get ignored by the pursuit of the almighty dollar and when large sums of money are involved who can blame the consumer for chosing the cheaper option. I fear unless the "bigwigs" at head office wake up to these problems their distributors in countries like Australia will become no more than distributors for spare parts to support grey imported products. Its understandable that in a market of 250+ million people the dealers can live off much slimmer margins than a country of 20 million as the economies of scale are massive, couple that with a favourable exchange rate (up to three weeks ago!!!) and its no wonder that this is such an issue. Consumer decision now comes down to save a few thousand dollars up-front and hope that they have no warranty issues. If the products today are as good as the advertising would say they are then its worth the gamble....I understand the arguments about C-tick approval and local support but when its a couple of thousand dollars involved I know what most people would decide...This is just a simple fact and an eternal question for those of us in the industry- Aussie consumers need to decide if they want a local industry/support or they are happy to take the gamble. For the record in New Zealand the system seems to actively encourage grey importing, so it could be worse...if anyone has all the answers I for one would love to hear from them....
Stuart Graham on 01-Jun-10 10:52 PM
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