Grey imports (also known as parallel imports, transient units or migrating machines) seem tempting. So tempting, that the Construction and Mining Equipment Industry Group (CMEIG) say many purchase grey imports without considering the risk.
“Equipment purchased anywhere other than from an Original Equipment Manufacturer (OEM) [or dealer] is likely to be a ‘grey import’ machine. Making it unlikely to be used in Australia as it will not follow Australian standards.”
—Construction and Mining Equipment Industry Group (CMEIG)
What Are Grey Imports?
According to JCB Construction Equipment Australia (JCB CEA), grey market imports are “machines or equipment sold into Australia as new, unused or low-hour machines for less than RRP.” In most cases, these imports are genuine, but arrived into Australia through unauthorised channels.
While it’s not illegal to buy grey imports, businesses who choose to buy grey import machinery are taking some risks.
The nature of a grey import is that it’s manufactured to suit the conditions of the country of origin. To buy a grey import machine could put the operator’s safety at risk:
- Many grey imports don’t meet Australian safety standards like ROPS, FOPS and hose-burst protection
- Many do not have built-in standard safety features such as seat belts
- Without standard safety equipment, it cannot be used in Australia
JCB CEA National Telehandler Manager Greg Sealey says Australia has some of the most stringent safety standards in the world.
“Features like ROPS, hose burst protection, and engine and hydraulic systems are pretty standard on telehandlers manufactured for the Australian market. In other countries, machines don’t have these features. This puts the machine operator at risk,” he said.
When you buy a machine through an OEM or licensed dealership, you have peace of mind that if something goes wrong, you’re covered. When it comes to grey imports, many OEMs can only honour warranties for buyers in the machine’s country of origin.
As an OEM, Kubota has a firm stance on grey-market units. “Kubota Australia does not provide parts, service, technical data or warranty support for Kubota “grey market” units in Australia. There is no responsibility either by Kubota or its authorised dealers for these “grey market” units.” they say.
Other risks include personal liability, voiding insurance and possible damage to reputation. According to the ACCC, if the business selling grey import machinery is overseas, there can be issues around your rights as a consumer. You may have practical and legal difficulties enforcing any consumer guarantee rights.
You’ll notice on authorised Australian machinery there is a compliance plate and certificate test that meets Australian Standards. Often, the grey market importer will leave it up to the buyer to contact the OEM or dealership to get a certificate of compliance. This could result in extensive modifications to the machine.
Parts & Support
Another issue with grey import machinery is the obvious lack of after-sales support. When it comes to new parts or machine breakdowns, the grey import is not covered by warranty. Costs can go up because your machine is not covered by the OEM or local dealership. So to fix the part/problem, it will cost full retail price. Or access to local spare parts could be difficult altogether.
Kubota go on to say, “…overseas Kubota outlets do not carry parts for models not for sale in that country… The age of some models means a particular part may no longer be available.”
*This information is for general use only. Machines4U recommend doing your own research into consumer laws and Australian compliance laws.