Five-star crash safety could become a thing of the past for cheaper models sold by one of Australia’s most popular car brands.
Hyundai, which sells about 100,000 vehicles each year in Australia and sits No.3 on the sales chart, claims the expense of complying with voluntary ANCAP safety standards is rising too high.
ANCAP – the Australasian New Car Assessment Program – is an independent body that crash tests new cars and hands them a zero to five-star rating depending on their performance.
ANCAP requirements are tougher than the mandatory crash tests cars must pass to be sold in Australia.
In existence since the early 1990s and aggressively promoted, an ANCAP five-star rating has become shorthand for maximum vehicle safety and a pass mark for mainstream car brands, including Hyundai.
Hyundai Australia chief operating officer Scott Grant admitted to The New Daily that could be about to change.
“If we need to be able to bring a high-quality product to market at the right price point that can appeal to consumers and is four stars, is that really the end of the world?” Mr Grant asked.
The crux of the issue for Hyundai is the threshold for achieving five stars keeps rising as ANCAP adds more mandatory safety equipment, such as autonomous emergency braking to its requirements.
That costs money to fit, but the prices of new cars have held static at the entry level for years at the $20,000 mark, squeezing profit margins.
Mr Grant’s warning drew no sympathy from ANCAP chief executive James Goodwin.
“We don’t apologise for continuing to raise the bar on vehicle safety, and it’s encouraging to see vehicle brands have been meeting ANCAP’s increasingly stringent standards,” he said in a statement provided to The New Daily.
“It is important to remember all investment in vehicle development and design has an impact on its overall safety – it’s not just having [autonomous emergency braking] or blind-spot monitoring that determines a star rating.
“Australia is one of the most open and competitive vehicle markets in the world, with every brand facing the same pressures. That’s a good thing for consumers and why ANCAP is also an advocate to improve vehicle affordability.”
Mr Grant said the extra costs that Hyundai would encounter to meet the standards could mean breaching the $20,000 threshold that would push the company’s vehicles out of buyers’ reach.
“It is no good having the most expensive, brilliant, high-tech, perfectly safe car that no one can afford to buy,” he said.
“There are plenty of good examples of motor cars that are rated four stars and they are terrific motor cars.”
If Hyundai does turn its back on ANCAP it would be the most significant setback for the publicly and privately funded body since the early years, when automotive brands refused to publish or promote its results.
While it might be the first to stop upgrading its cars to achieve five stars, Mr Grant insisted Hyundai was not the only brand grappling with this issue. If that is the case, other brands could soon follow suit.
ANCAP would undoubtedly react forcefully to any break in the ranks. In the past it has lashed poor safety results, notably the two-star rating for the popular Ford Mustang sports car.
“At the end of the day I am not concerned about that,” Mr Grant said.
“We have to be responsible and take a leadership position for our business and for our brand with consideration to – but not at the behest of – others that are involved such as motoring writers, ANCAP or other parties.
“We have to take that responsibility, otherwise trying to placate all the different stakeholders, we could just run ourselves into the ground and disappear.”