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NEW ZEALAND: Used car importers stock up to beat safety ban

By just-auto.com editorial team | 18 February 2002

Imports of used cars into New Zealand increased 43 percent year on year to over 12,000 in January as dealers stocked up to beat a looming ban on pre-1994 models.

New Zealand, which has traditionally had a relaxed and flexible approach to safety regulations, is finally to require an approved frontal impact protection system on all used cars imported from 1 April. Cars made in Japan before 1994 do not have the combination of safety features required.

These include a front crumple zone, a rigid passenger cell, collapsible steering column, auto-tightening seatbelts and anti-submarine seats.

The Press newspaper in Christchurch said that a flood of older cars coming into the country was expected to drive prices down in the next few months.

But the national dealer group, the Motor Vehicle Dealers Institiute (MVDI), warned that buyers after cheaper used vehicles will get a shock later this year.

A family expecting to pay up to $NZ8,000 ($US3,400) for a 1992 Japanese car would have to find double that amount for a newer, approved model, the Press said, citing MVDI executive director Steve Downes.

People unable to afford the higher prices would decide against trading in their older cars.

"That's going to have some pretty disastrous effects," Downes told the Press. "People will end up either driving cars that are not warranted [i.e. not passed a mandatory six-month government safety inspection] or not registered [not paid annual road tax]."

The Press said that the New Zealand government transport minister Mark Gosche believes the new safety rules will save at least five lives a year [in a country with a 3.8 million population where road crashes account for 400-500 deaths annually].

Earlier, over 100 Christchurch car dealers said they were preparing a legal challenge against Gosche, who announced the new safety regulations late last year.

But, according to the Press, dealers are apparently divided on the issue. The newspaper said that dealer Andrew Simms supports the changes, adding that some dealers had "a vested interest in the continued importation of old, and in some cases, sub-standard vehicles".

"Good dealers will adapt, and survive under the new regulations. Talk of industry lay-offs, closures, and massive price rises as a result of these regulation changes is unfounded and not supported by the facts," Simms told the Press.

New Zealand#;s Land Transport Safety Authority (LTSA) told the newspaper that car dealers stockpiling older vehicles for the cheaper end of the market were taking a risk.

"The shutters do come down on April 1, and if these vehicles haven't been certified by that time, they will never be able to get on the road," LTSA principal engineer Andrew Justice told the Press.

Used cars have generally outsold new cars in New Zealand since the late 1980s when the government deregulated the industry and allowed anyone to import new or used vehicles.

The policy was intended to renew the New Zealand vehicle fleet which was then older than most due to years of import restrictions maintained by a combination of import licensing and high import duty and sales tax.

Toyota New Zealand chairman Bob Field recently claimed that the country now enjoyed the lowest new car prices in the world but his company, together with other new vehicle importers, has, over the years, criticised the ‘used imports#; policy for not in fact reducing the age of New Zealand#;s cars, as promised.