The AU EU Free Trade Agreement is the agreement between the European Union and Australia to remove most of the trade tariffs on both imports and exports. With so much attention, both by Government and in the media, of the fuel situation and Middle East crisis, this deal may have gone unnoticed for many people.
As the deal represents increased opportunities agricultural producers, buyers in many other markets may have missed the announcement. The removal of tariffs applies to many imports from Europe including motor vehicles and equipment related to transport. That should include motorbikes from Euro manufacturers including some of the big names such as BMW and Ducati. That means, prices should come down.
In commenting on the effect of the agreement on the car market, Tony Weber from the FCAI which also represents motorbike manufacturers, welcomed the development. Mr Weber said it brought Euro-sourced motor vehicles in line with imports from Asian markets.
The agreement should be good news for those considering a Euro-sourced machine in the near future. It may also bring higher-end models within the affordability zone of many other buyers. Broadening the market for riders to obtain these sought after brands.
What is the AU EU Free Trade Agreement?
Countries impose tariffs on goods being imported into their market, according to their own policies. These policies may be to protect their own industries. Many countries seek free trade arrangements with key markets to provide greater opportunities for their own producers.
Australia and the European Union have had tariffs on both sides. Australia imposes a tariff on imports of around 5% on many goods. The EU has tariffs and other restrictions on imports from Australia, many to protect their own agricultural sector.
In 2018 negotiations commenced between the two markets to establish a free trade agreement (FTA). After 8 years, these negotiations came to fruition at the end of March 2026 with final details and an implementation date to be announced.
Essentially, most tariffs on Euro sourced products imported into Australia will be removed. Producers exporting to the European Union market will see many trade barriers removed. For Australian buyers, they may expect that approximately 97% of goods from the European market will see a price reduction with the tariff removal.
Effect on Motorcycle Prices
Tariffs are applied on the importer and the import price at the point of entry to a country. For motorcycles, this means the importer would be subject to paying the approximately 5% tariff. The total cost would be incorporated into the price offered by dealers. Buyers are not charged these tariffs on top of the purchase price.
Buyers can expect that pricing on Euro brand machines will be reduced by the amount of the tariff reduction. These may apply to models from manufacturers such as Husqvarna. Aprilia, Ducati, Moto Guzzi and BMW Motorrad. Any savings which will be appreciated by buyers.
The removal of the tariff and any resultant price cuts would apply to new stock coming into the Australian market after the FTA is fully implemented. The Australian Government has not yet released this date. Buyers should not expect to see pricing on current models already in dealerships and with wholesalers to change. The FTA would not affect second-hand machines.
EU Free Trade Agreement and Motorcycle Finance
Removal of tariffs on motorcycles imported from the European Union would not change motorcycle finance. Loans are not subject to trade tariffs. The features and format of loan products, specifically a Secured Motorcycle Loan, are set by lenders, with some similarities.
Interest rates will also not be affected by the FTA. Lenders set their own rates based on the cash rate which is set by the Reserve Bank. The assessment process for determining rate offers to individual applicants would remain unchanged.
If inflation were to fall significantly on the back of reduced prices for EU imports, this may result in the RBA announcing a cut to the cash rate. But a fall in inflation may be the result of changes in many prices.
While the rate offered and the loan required will not change with the FTA, what may change is how much is required for a loan on EU imported machines. Lower prices may mean buyers will need to borrow less to make their purchase. To get loan estimates based on guesstimates of new pricing after the FTA comes into effect, use our Finance Calculator.
If you are wondering if you may be able to afford a Euro brand motorcycle if the prices were to come down, apply for conditional loan approval. This approval is given prior to the purchase and provides buyers with their borrowing power – how much they can borrow, and a loan quote. The quote is subject to finalising after the sale and based on interest rates at that time.
To take advantage of potential lower motorcycle prices on some brands after the EU Free Trade Agreement comes into effect, contact Jade Bike Loans on 1300 000 003 for a finance quote.
DISCLAIMER: IN REGARD TO ANY ERRORS OR MISREPRESENTATIONS IN THIS MATERIAL, NO LIABILITY IS ACCEPTED. THE DETAILS, CONTENT AND DATA IS PRESENTED PURELY FOR GENERAL INFORMATIONAL PURPOSES FOR MOTORBIKE BUYERS AND THOSE SEEKING MOTORCYCLE LOANS. THIS IS NOT INTENDED AS THE SOLE SOURCE OF INFORMATION FOR FINANCIAL DECISIONS. IF SPECIFIC ADVICE IS REQUIRED AROUND FINANCIAL DECISIONS, READERS SHOULD SEEK THEIR OWN FINANCIAL ADVISOR.
