Q: Did your members face any challenges during the COVID? Elaborate.

Charity: As the pandemic started to impact Australia in February, our members initially faced the uncertainties of the virus itself and how that would affect their businesses, customers, employees, and the economy. State and Territory Governments then started imposing various levels of restrictions on people movement and trade. This affected (to varying degrees) large portions of manufacturing, distribution, retail, and automotive service and repair across the country.

Our members then faced the challenge of interpreting hastily constructed and not always coherent new regulations and sought answers to whether they could remain open, and if so to what degree.

Businesses also had to navigate the various Government assistance options available, make difficult decisions around staff, faced the loss of revenue and customers and worried about the short-term survival of their businesses.

Following a national lockdown from March through to May, Australia regained control of infection numbers, and once restrictions started easing businesses exhibited substantial recoveries. However, the state of Victoria (the second largest in Australia) was hit with a second, much larger COVID-19 wave in June. The Victorian Government responded by imposing a hard lockdown of metropolitan Melbourne which ran from July until the end of October. It is only now that restrictions are slowly being wound back, that Melbourne based businesses can start their process of recovery.

Q: What are the learnings for AAAA from the pandemic and how the association supported its members during this time?

Charity: We were proactive in our approach to the pandemic, but of course no one was fully prepared for how events would turn out and the scale of the impact on our economy.

As the first wave hit, we received an unprecedented influx of members and the broader industry who turned to the AAAA seeking information and assistance. Our primary role was to influence and interpret Government regulations and support offerings and provide clear and timely information to our members. Regular, accurate updates assisted our members in making the best decisions and receiving the Government support they needed.

Due to the high level of demand for this information, we had to adapt and further strengthen our communication methods quickly. We added online webinars to our repertoire of communication channels to provide information to as many people as possible. Webinars provided the additional benefit of allowing direct, live member Q&A sessions.

Members had direct access to our advocacy team during the crisis, and the team were inundated with individual requests and queries asking for advice concerning the pandemic, the Government response and their particular situation.

We were successful in lobbying Government to classify automotive repair as an essential service. As a result, the majority of our industry stayed open throughout the year, and we have lost very few staff from the industry, which is a remarkable achievement.

The innovation that was displayed right across the sector was inspiring-mechanical workshops implemented contactless drop-off and pick up systems, adopted SMS and digital communications to inform their customers that they were still open and implemented a range of process changes to ensure the safety of their staff and customers.

Our parts supply chains had to deal with working from home arrangements, scaled back staffing in distribution centres and a whole range of logistical challenges to ensure the trade had the right part, at the right time for the right price.

Automotive retailing also held up remarkably well right throughout the year as people with disposable income and extra time worked on their cars.

We also learned how resilient our industry is. Despite the challenges, we saw incredible resolve, determination and support across the industry and ‘being in this together’ unified everyone toward common goals, putting aside competitive rivalries for the greater good.

Q: How are online sales in the automotive parts retail segment evolving in Australia?

Charity: While online sales of automotive parts and accessories have grown over the past five years due to the strong consumer uptake of online shopping in general, they still make up less than five percent of the overall market. The diversity of the Australian car parc and the need to ensure parts meet exact specifications means that many consumers and trade customers still buy from traditional bricks-and-mortar retailers and resellers. Having said that, outside of the online marketplaces such as e-Bay, the majority of online sales are through the large traditional retail groups such as Supercheap Auto, Bapcor (Autobarn/AutoPro) and GPC (Repco/Sparesbox). While Amazon attempted a major push into online retailing of automotive parts and accessories several years back, they have not been able to gain significant market share from the established online retailers.

Q: What is the role played by AAAA whenever issues crop between nations on Tariff etc.? Is there any impact on imports of aftermarket products from China?

Charity: We take a proactive approach to address any tariff issues that arise from time to time that have the potential to impact on our membership. An example of this was in 2019 when the Trump administration was considering imposing a Tariff of 25 percent on automotive products exported into the USA based on national security grounds (section 232). The USA is our largest export market.

We were able to lobby for our Department of Foreign Affairs and Trade to engage with their US State Department counterparts to advocate for Australia’s interests with the US Administration. This involved direct representations by Australia’s Foreign Affairs Minister as well as our Ambassador to the USA to put the position that the products that the Australian industry supply into the USA complement rather than compete with US manufacturers. Ultimately the Trump administration did not proceed with the Tariff.

We have not experienced any issues with the import of aftermarket products from China other than some isolated supply issues earlier in the year as a result of the impact of the COVID-19 on China’s manufacturing sector.

Q: The connected vehicle is a boon for the users; how is it for the aftermarket industry?

Charity: Similar to other new technologies, connected vehicles present new opportunities for the aftermarket; however, at the same time, challenges have presented themselves. Over the years as vehicles include more and more electronics, both hardware and software, it has made it more difficult for independent service and repair workshops to access software updates and repair and service information from car manufacturers. This has a flow-on effect on their ability to compete with dealerships on fair and reasonable terms in servicing and repair of vehicles. We have campaigned for over ten years to have a law implemented that compels the manufacturers to share this data. In great news, a mandatory data sharing law will be introduced in Australia in 2021, which will force all car companies to share all repair and service information with all repairers on fair and reasonable commercial terms.

Despite the advances in the connected car, the fundamentals of vehicles have not changed. Components need service and repair, and vehicles remain open to all manner of modifications and customisation. In Australia, changing government regulations can impose challenges regarding the modification of vehicles; however, we have a constructive dialogue with regulators to ensure our members can continue to offer safe accessories and modifications for vehicle owners.

Q: What percentage of sales in Australia account for electric vehicles? What is the current EV parc? How does AAAA support its members in catering to the requirements of these new breed vehicles?

Charity: Electric vehicles continue to gain some popularity with sales volumes increasing year on year; however, they remain a tiny part of the Australian car parc. Electric vehicles account for only about 0.6 percent of the Australian market currently. Sentiment wise, consumers are more receptive towards owning an EV vehicle than five years ago. The main challenges we face are the lack of EV charging infrastructure and the vast distances involved in Australian road networks, as well as the price of EV’s compared to the equivalent internal combustion engine model. We don’t foresee any sizeable shift in the change to the car parc in relation to EV’s for at least another ten years.

At an AAAA-member support level, we are beginning to host information and training evenings that focus on EV safety and specific servicing requirements and monitor any changes in the car parc or Government regulations around EV’s that may have an impact on the industry.

Q: Can you briefly tell us about your initiatives in building professional skills to your members?

Charity: One of the core principles of the AAAA is to ensure member sustainability and foster member growth, with skills development an important component of this.

At Government level, we support and advocate for issues around skills and training. In Australia, there is a shortage of skilled labour, and our industry needs more apprentices to choose automotive as a career. Along with Government advocacy on these issues, we are increasing our work on strategies at an industry level to drive new apprenticeship levels and interest in what is a fantastic and diverse industry.

AAAA members are exposed to regular AAAA training and networking evenings, designed to educate and build skills of those in our industry. Our member webinars are often themed toward skills development with topics including local area marketing, cash flow and business efficiency.

We also provide business development tools and services to members. This includes access to our advocacy team, market research, including our Car Parc Data tool and Workshop Health Check, and hotlines for human resource and legal matters.

Q: Can you update on the “Automotive Innovation Labs” that AAAA established in Victoria and South Australia a couple of years ago?

Charity: The Auto Innovation Centre (AIC) is just about to celebrate its first birthday in Victoria, while the facility in South Australia is close to being opened. The Melbourne facility contains cutting-edge testing and scanning equipment, workshop facilities and other manufacturing and development capabilities for our industry to utilise, plus a fleet of new vehicles for product development.

The AIC is already the go-to facility for many Australian businesses seeking assistance with product development thanks to its unique capabilities. The AIC conducts regular Electronic Stability Control and Brake Testing to ensure products such as suspension and braking systems meet Australian Design Rules. 3D Scanning is another popular service offering, with a soon to be launched database of vehicle scan data available to subscribers. The AIC also hosts businesses that run training, networking and information evenings and the fully equipped workshop is used by companies for product fitting sessions using the AIC vehicle fleet.

Q: What is your outlook for the growth of the aftermarket in the next five years?

Charity: We are very positive about the growth outlook in the aftermarket over the next five years as all the key drivers that we look at to assess future demand in our industry is positive. These include:

The fact that Australians are still very reluctant to use public transport like they did in the past which has driven up the price of second-hand cars as families buy a second or even third car to ensure they can get to where they need to be without relying on transport.

New car sales that had already experienced two consecutive years of month-on-month declines have been decimated this year. This will drive up the average age of vehicles meaning that a greater proportion of vehicles will and are being serviced in the independent aftermarket.

With many interstate borders still closed and international borders shut for the foreseeable future, we are seeing the return of the family road trip which has seen a massive boom in the sales of 4WD accessories and vehicle modification services.

To further support these market dynamics, the imminent introduction of a national mandatory data-sharing law will lay the foundation for further strengthening of the independent service and repair sector moving forward.

So while 2020 is a year that we’d all rather forget, we are experiencing strong demand for our products and services across all segments of the aftermarket and we are projecting this to be sustained over the next five years. (MT)

A memorandum of understanding (MoU) has been signed by Bharat Forge Ltd (BFL), a multinational aerospace and technology company based in India, and VEDA Aeronautics (P) Ltd (VEDA), an Indian aerospace and defence company that develops and supplies unmanned systems, to develop cutting-edge unmanned aerial vehicles (UAV) and other high-speed aerial weapon systems used in combat.

BFL will provide the micro jet engines utilised in these unmanned systems, while VEDA has been involved in developing the technology for these systems for the defence forces. In order to improve India's defence capabilities and promote national self-reliance, the MoU is anticipated to be crucial in using each other's strengths.

Guru Biswal, CEO – Aerospace Division, Bharat Forge, said, "This MoU with VEDA is a testimony of our commitment to work for an ‘Atmanirbhar Bharat’ and to create niche technologies that shall support Indian and Global requirements in the evolving technological landscape of warfare. BFL will focus on indigenous development of jet engines up to 400 Kgf thrust to power the unmanned systems developed for Indian defence forces. The 40 & 45 Kgf engines developed by BFL are under serial production and will be used by VEDA for all defence projects.”

Dipesh Gupta, Managing Director, VEDA Aeronautics, said, "We are thrilled to announce our strategic partnership with BFL aerospace, which will supply small jet engines for all defence and other unmanned system projects of VEDA Aeronautics. This endeavour underscores our unwavering commitment to innovation, heralding a new era of technological advancement and strategic prowess in the aerospace domain specific to Long Range Combat UAV Systems, High Speed Aerial Targets and Multi Barrel Launched Jet Based UAV Systems.”

Honda India Foundation (HIF), the CSR arm of all Honda group of companies in India, and the Government of Uttar Pradesh have signed a memorandum of cooperation (MoC) and marked the commencement of ‘Project Annadata – Sashakt Kisan, Samridh Rashtra’, which aims to support and strengthen Farmer Producer Organisations (FPOs) in the state.

Prominent dignitaries such as Surya Pratap Shahi, the Uttar Pradesh Minister of Agriculture, and Vinay Dhingra and Katsuyuki Ozawa, trustees of the Honda India Foundation, attended the signing ceremony in New Delhi. Honda's cooperative approach to rural development was highlighted by representatives from Honda Motorcycle and Scooter India (HMSI), Honda India Power Products (HIPP) and Honda Cars India Ltd. (HCIL).

With an emphasis on systematic reviews, capacity-building efforts, business planning and operational advancements, HIF, through its implementation partner, will onboard and strengthen 10 FPOs in two clusters of five FPOs each as part of this initiative. In order to guarantee efficient FPO operations and the implementation of contemporary agricultural methods, this association seeks to offer technical assistance. In order to promote long-term sustainable practices and protect the resources for future generations, the initiative seeks to involve farmers, young people, environmental campaigners, educational institutions, legislators, non-profit organisations and other stakeholders. Over 100,000 people are anticipated to be reached during the project's initial phase, and over time, it may have an influence on one million persons involved in agriculture.

Vinay Dhingra, Trustee, Honda India Foundation, said, “At Honda India Foundation, we are dedicated to empowering rural communities and enhancing agricultural productivity, aligning seamlessly with the Government of India’s vision as also reflected in the 2025 Union Budget. Initiatives such as the Prime Minister Dhan-Dhanya Krishi Yojana, the mission for Atmanirbharta in Pulses and ensuring fair prices for farmers resonate with our objectives. Our efforts to strengthen FPOs through Project Annadata are in harmony with these priorities as we work towards improving resource access and create a resilient agricultural ecosystem that will benefit farmers at scale. This collaboration will enable us to create a meaningful impact at the grassroot. We will continue to contribute towards the development of a more resilient and prosperous agricultural ecosystem.”

The automotive retail sales in January 2025 grew by 6.63 percent YoY, a growth much better than previously anticipated by most industry observers. A total of 22,91,621 vehicles were sold across segments, which includes 15,21,862 two-wheelers (+4.15 percent YoY), 1,07,033 three-wheelers (+6.86 percent YoY), 4,65,920 passenger vehicles (+15.53 percent YoY), 93,381 tractors (+5.23% YoY) and 99,425 commercial vehicles (+8.22% YoY) according to the latest data released by the Federation of Automobile Dealers Associations (FADA).

“The auto retail sector kicked off 2025 on a promising note, aligning with FADA’s earlier survey projections that expected January to range from flat to moderately positive. Indeed, overall retail sales posted a robust 6.6 percent YoY growth, reinforcing the industry’s optimistic start. Our observations indicate that each vehicle category – two-wheeler, three-wheeler, passenger vehicle, tractor and commercial vehicle – witnessed positive momentum, pointing toward sustained consumer confidence and steady market recovery,” said C S Vigneshwar, President, FADA.

In the two-wheeler segment, urban sales outpaced rural sales on the back of new model launches, marriage season demand and improved financing as key growth drivers. However, concerns about rising interest rates, rural liquidity challenges and market uncertainty still linger.

The passenger vehicle segment saw some spike on the back of ‘2025 model year’ sales, as the previous year models do see significant discounting.

“Commercial Vehicle sales increased by 8.22 percent YoY and surged 38.04 percent MoM, with urban markets climbing from 50.1 percent to 51.2 percent share and outpacing rural growth (9.51 percent vs 6.89 percent). While higher freight rates and passenger carrier demand provided a boost, many dealers cited low cash flow, strict financing policies and sluggish industries (like cement and coal) as major hurdles. Sentiments in rural regions remained notably subdued, compounded by limited new products. Overall, the sector shows cautious optimism but faces persistent headwinds,” added Vigneshwar.

Going forward, FADA maintains a cautious optimism for February, with dealers having a mixed sentiment ranging from an uptick, flat to even a drop in sales.

The tailwinds include continuing marriage season, fresh product launches and strategic promotional activities to sustain customer footfalls. This will be aided by improved inventory management, better financing options from select lenders and backlogged orders in certain segments (such as commercial vehicles) add to the sense of guarded confidence. With supportive policies and a post-budget lift in consumer sentiment, many believe February could see a stable or slightly elevated sales curve.

On the other hand, the headwinds expected include shorter working days, pockets of weak rural liquidity and inflationary pressures. Then there is the strict lending criteria, costlier vehicles and subdued demand in certain industrial sectors to further weigh on overall performance.

Arranged in one corner of Hall 6 of Pragati Maidan in the Bharat Mobility Global Expo 2025 was an air-taxi called Shunya. Developed by Sarla Aviation, a Bengaluru-based startup, the air-taxi attracted a good deal of crowd, reflecting a new and future mode of transport or mobility.

The Shunya air-taxi prototype could facilitate a new mode of mobility much like a radio-taxi does to travel between Mumbai and Pune; between Mumbai and Kalyan; between Delhi and Jaipur or between Delhi and Meerut, for example.

Intending to launch the electric air-taxi in Bengaluru by 2028 to become the first to introduce urban air transport in India, Sarla Aviation (the company’s name is inspired by Sarla Thakral, India’s first female pilot) is steadfastly focusing on an indigenous design and manufacture since the beginning of the operations.

A testament to Sarla Aviation’s commitment to innovation and sustainability, the Shunya air-taxi proto has been designed to execute short trips of 20 to 30 kms with speeds of up to 250 kmph with up to six passengers onboard. As the first eVTOL of its kind in the country, it marks a pivotal moment in the history of Indian civil aviation, showcasing the nation’s growing prowess in cutting-edge aerospace technologies.

Capable of carrying a maximum load of 680 kg, according to a source aware of the development, the air-taxi offers a market-leading payload capacity such that every passenger can bring his or her luggage. The luggage is conveniently stored in the rear of Shunya with exterior access for ease.

Prioritising safety, purpose-driven performance and accessibility, Shunya – poised to redefine mass transportation – can take off from any flat surface, whether on top of a building or in a rural area, making it the most infrastructure-efficient mode of mass mobility ever, according to the company.

Working on a strategy that will see Shunya facilitate efficient commuting in megacities like Bengaluru, Mumbai, Delhi and Pune, Sarla Aviation is also looking at how its offering could facilitate social commitments in the form of an air ambulance that reaches where no vehicle or other means of mobility is able to reach. An air ambulance could also be used in urban and semi-urban areas to beat the road congestion.