CEO Update #3 - 27 March 2020

Hi Team,

The Motorama Senior Management has been exploring every possible option in consultation with our external advisors to ensure that we are acting on Motorama’s core values of 'teamwork' and 'care'.

All decisions have not been made lightly with much deliberation and heart-ache knowing full well that these necessary changes will have a direct impact on you and your families - like so many other families in this Country during this time. However, the changes we will be enacting are essential for Motorama’s long-term viability during this unprecedented crisis, the likes of which none of us have ever had to deal with previously.

In relation to your relevant modern awards governing your employment with Motorama, we are required to advise you of any major changes that will affect your normal employment conditions with Motorama. Whilst it would be preferable to consult with all of you in person about the below information, the current Government directives do not allow for large group meetings, so we are unable to hold group consultation meetings on the matters we raise below.

I can assure all of you that the Senior Management team’s sole objective during this crisis is to take all necessary steps to preserve the jobs of our people (you) in the aftermath of this crisis – as we will need all of you to help us get back to the business we are all so proud of.

As you will no doubt have seen from the extensive media reports and daily updates provided by the State and Federal Governments, there have been significant government mandated closures across many industry sectors across Australia. So far, the motor industry has not been one of these mandated business closures.

However, you have all seen and experienced the direct effects of these closures with the significant downturn in customers utilising our services. This has not been limited to one department but can be seen across both the sales and servicing departments. Every day, many businesses around this country are standing their workforce down as a result of economic necessity to ensure that their individual businesses will survive this crisis and be in a position to provide their employees continued employment and to return to normal trading as soon as possible when the crisis abates.

As I advised in my previous communication, Senior Management’s proposed first step was to have all staff move to temporary working arrangements that would involve all employees working reduced hours. That proposed approach was to deal with two issues:

1. Firstly, it would ensure that we were taking all necessary preventative measures to contain any outbreak of COVID-19, should someone infected with the illness attend one of our workplaces. This approach would have allowed us to continue our business operations maintaining Government mandated social distancing requirements and to enable us to continue to carry on our business if one of our team members needed to be isolated for a period of time.

2. Secondly, based on the sales data available to us at the time, it would have enabled Motorama to take all steps necessary to preserve the ongoing employment of our people in the current economic environment.

Unfortunately, given the incredible speed at which this crisis is unfolding and the immediate and serious adverse economic impact it is having on all businesses, Motorama can no longer consider our previous proposal as a viable option if we are to achieve our main objective – the preservation of your jobs in the aftermath of this crisis. This decision has not come about lightly, and it is purely as a result of economic necessity to ensure the survival of Motorama.

All of you are our most valuable asset and we will need you all to help Motorama come back bigger and better from this crisis.

Bearing the above in mind, it is with great regret that I inform you that we will be standing down various sections of our workforce in the coming days.

As said above, our Senior Management team have considered many options in coming to this decision and we see this measure as critical to ensuring that all positions are maintained for the future by ensuring the long-term viability and survival of the business. In reviewing all of the recent sales and service information available to us, we have identified that there is simply not enough work being generated to keep every employee usefully employed.

Already, the State and Federal Governments have made some significant decisions in other industries that have shut down entire workplaces and left those employees without work, without pay and reliant on the JobSeeker allowance in the immediate future. The motor industry is not immune from this happening to us sometime in the near future as the Government tries to stop the spread of COVID- 19. However, currently we are classified as an essential service and as such, a number of team members will be retained to ensure we can provide those essential services.

Initially, the stand down will be staged based on the reduced operational requirements of the business. A stand down allows a business to temporarily place an employee’s employment on hold over a nominated time frame during which an employee will not receive pay. However, based on the recent Federal Government relief package announced earlier this week, eligible permanent employees stood down during this crisis will be entitled to seek the government assistance being offered. As we understand it, stood down employees are eligible for the JobSeeker allowance for the period of the stand down. Further, during any period of stand down, all of your annual leave and long service leave entitlements will continue to accrue; however, you will not have normal access to your annual leave or long service leave during the stand down. All employees who are stood down during this time will be authorised to take 5 days of annual leave to be paid over a 2 week period to assist you and your families in transitioning to the JobSeeker Allowance and/or early access to superannuation (if applicable).

Most simply, we are being forced to take these drastic steps for circumstances outside of our control. Rest assured, the steps we are taking are to ensure that when this crisis is over, your employment is preserved and we as a team can ramp up as quickly as possible to return to normal operation. However, depending on how long it takes for the Australian and other Governments to get this crisis under control, any return to work may be also staged depending on demand for our services.

I know this is a very concerning and a trying time. I want you to know that as an executive group we are doing everything we can to minimise concerns for our employees, but at the same time, this is an unprecedented time that we are all in together. No business in Australia is immune to this crisis. I am proud that at Motorama we have such a strong culture and of how well we do work together and how we will all get through this crisis together. Working together and caring for each other and our guests is what will see us through this crisis, and by doing this we will come out stronger once it is over – I am confident in that. We will continue to do everything we can to assist you and your families during this crisis.

We know that you will asking what does this mean for me? As each department needs are different, we will be starting to stand people down today and that will continue to happen over the coming week as we run out of work. As part of this process we will look to implement a first out, first back policy where possible so that everyone is treated as fairly as possible. Your manger will be in contact with you as required.

We would welcome any questions you might have in respect of this letter. Please direct all feedback to your Managers, General Manager or send to Yvette Bartlett (yvette.bartlett@motorama.com.au).

We will keep communicating with you, and we need you to keep communicating with your Manager and General Manager so that we can continue to work through things together. Thank you for your patience and understanding, and thank you for continuing to provide a remarkable experience and service for our customers.

Regards,

Mark P Woelders

Managing Director