The Victorian Automotive Chamber of Commerce (VACC) released its Pre-Budget Submission for 2025-26, calling on the Victorian Government to implement reforms to support the state’s automotive industry through its transition to zero-emission vehicles (ZEVs).
The comprehensive submission outlines 16 key recommendations across taxation, industry support, consumer protection, skills and training, and workplace relations.
It highlights data that shows service and repairs are being delayed due to financial pressures on drivers, potentially endangering owners and the state government needed to intervene with support.
The report also highlighted that 27 per cent of motorists are postponing tyres, windscreen replacements and physical damage repairs due to financial concerns.
“Tyres in particular play a critical role in vehicle safety, influencing steering, braking, and traction systems.8 Delays in tyre maintenance directly compromises road safety,” it noted.
VACC CEO Peter Jones highlighted how the automotive industry faces unprecedented challenges and the budget submissions were crucial in supporting an industry a key time of change.
“As it adapts to new technologies and market demands. These challenges are compounded by ongoing workforce shortages and increasing regulatory pressures,” Jones says.
“The automotive industry is the backbone of Victoria’s transport system. Every day, our members ensure millions of Victorian motorists can safely travel to work, transport goods, and keep our economy moving. But this vital industry is at a crossroads.”
“With the Victorian Government’s target of 50 per cent of all light vehicle sales in Victoria to be ZEVs by 2030, we need immediate action to ensure our industry can meet this ambitious goal. Many of our members, particularly small businesses and independent repairers require substantial support to invest in new equipment and upskilling.”
Submission highlights concerns
The submission highlights concerning data showing that 35 per cent of motorists are delaying vehicle servicing and other due to cost-of-living pressures, creating significant safety risks on Victorian roads.
“We’re calling for a subsidised vehicle maintenance scheme targeting vulnerable motorists. Road safety cannot be compromised due to financial constraints,” Jones says.
“The potential consequences of neglected vehicle maintenance extend beyond individual vehicles to impact the broader community’s safety.”
It noted that the concluded ‘Unsafe2Safe,’ program which incentivised young drivers in regional Victoria to replace old, unsafe vehicles, had delivered positive results. but that it ended in March 2024, leaving a gap in support for vehicle safety improvements.
“We urge the government to introduce a subsidised vehicle maintenance scheme in collaboration with the automotive repair industry. This scheme would provide free vehicle safety checks for consumers and offer subsidies for critical safety repairs, particularly targeting low socio-economic groups and those considered vulnerable.”
Adding to these industry pressures is the significant burden of land tax on Victorian automotive businesses, with some VACC members reporting increases of over 224 per cent between 2018 and 2025.
“These substantial land tax rates are severely impacting our members’ ability to invest in new technology and training,” Jones says.
“When businesses are paying more in land tax annually, it becomes challenging to invest in critical projects needed for skills development and equipment upgrades.”
Key recommendations include
- Financial assistance for automotive businesses transitioning to service zero-emission vehicles
- Reforms to land tax and the removal of Super Luxury Duty
- Establishment of a government task force to combat organised crime in private car sales
- Enhanced funding for vocational education and training in thin markets
- Additional support for the Victorian Workers Compensation Scheme
The VACC represents over 5,000 members across Victoria, with 20 retail automotive sectors employing over 50,000 Victorians. The organisation has been the voice of the automotive industry for over 100 years, advocating for policies that support both business sustainability and public safety.
View the Pre-budget Submission here.