Croker built a lead of nearly three minutes over the first day and a half of competition but an issue on the penultimate stage almost cost him the win with Giddins closing the gap to just 34 seconds in the end.

The Rally of the Bay is a favourite event for many drivers and Croker says winning his home round is a real highlight for him.

"This is the standout event of the series. The roads are fantastic and competition is always pretty tight," Croker said.

"Having the drama on the second last stage meant it was a bit touch and go at one point but it's great to win the Rally of the Bay."

Cooma based Andrew Penny had a fiery exit from the rally as his Subaru WRX erupted in flames on the opening stage of the day and burning to nothing more than a shell.

Penny reported power loss with one kilometre of the stage remaining before the engine is believed to have seized. He pulled off into a clearing as he and co-driver Jeff Matthes noticed smoke.

"We pulled into a clearing off the road and jumped out so see flames developing," Matthes said.

"We hit it with the fire bomb which kind of put it out as well as two fire extinguishers but it just kept reigniting."

The battle for the final spot of the podium saw Brett Middleton hold out Gary's Motorsport Tyre NSW Championship leader Mick Harding for the opening day and a half of stages.

Harding's four wheel drive Subaru proved too strong for the Middleton Honda Civic and he built a gap of nearly two minutes in this afternoon's stages.

Harry Bates' driving debut saw him narrowly miss out on a top ten finish by 23 seconds in his Toyota Corolla after a puncture set him back on the penultimate stage.