ASSEMBLING CARS

ADJUSTMENT OF DUTY

. UTILISING LABOUR

With the object of encouraging the assembling of 'motor-cars in New Zealand, Mr. Coates announced a readjustment of the duty on imported complete arid unassembled vehicles.

"When I previously dealt with' the matter as to tho duties on motor vehicles," said Mr. Coates, "I referred to the question of the assembly of cars in New Zealand. The Government feels that if there is any possibility of a satisfactory secondary industry arising in tho Dominion in connection with motor-cars it will be along the linos /of assembling cars imported in a knockeddown condition. At the same time this will enable New Zealand labour and materials to be utilised. To show the extent to which such an. industry is possibly capable of expansion • I might mention that of the registrations of motor-cars during the last seven months about 80 per cent, were those, of eight manufacturers abroad. I am 'glad to be able to state that, generally speaking, and subject to certain details which require to be gone into, the English manufacturers iiro prepared to ship unassembled cars to New Zealand for completion here. If this can be achieved it will afford employment to a considerable number of workers directly in the completion of vehicles and indirectly in tho utilisation of local materials. ■ THE NEW BATES. "Further information obtained by the Government indicates that the concession already made on unassembled cars is not sufficient to encourage manufacturers abroad to have their vehicles assembled iv New Zealand. ' It has therefore been decided ultimately to fix the duty on completed and unassembled vehicles at the following rates:— , ' British preferential General tariff. tariff. Complete vehicles 15% 60% Unassembled .;. 5% . 50% . "The Government recognises that the English manufacturers will not generally be able for some little time to take advantage of the concessions proposed, and it is intended that the newrates shall not come into force until January 1 next, and that, in the meantime, tho duties will bo as under:— British preferential General tariff. tariff. Oil complete cars— Up to December 31, 1034 10% 55% Thereafter 15% 80% On unassembled or completely knocked down cars— Up to December 31, 1034 10% ' 53% Thereafter ' 5%. .50%" "This means that for a few months the rates of duty on complete and unassembled cars will bo the same, but that thereafter there shall be a differonce of 10 per cent, ad valorem between the two. From information supplied to the Government it is believed that four months is sufficient to enable the assembly of cars to be undertaken in New Zealand. TRUCKS AND CHASSIS. '' Another modification proposed is that tho concession, at present restricted to unassembled cars, should be applicable also to trucks and chassis. This action will have the effect of reducing transport costs and at the same time will facilitate the administration. It is proposed, when the principle of admitting unassembled cars at a . reduced rate is confirmed by Parliament, to consult the trade with a view-to arriving at a satisfactory definition of what is to bo understood as an, unassembled or completely knocked down vehicle.

"I recognise that in the initial stages it -will not be advisable as a condition

of admission at the lower rate to insist upon tho maximum amount of assembly work that could possibly be performed here. The policy should rather be to insist at the commencement upon a minimum of work which must be carried on in the Dominion and by degrees to modify the definition of unassembled or completely knocked down ears so that an increasing amount of local labour and materials may be utilised in New Zealand. I feel sure that the Government can rely upon the assistance and co-operation of all those interested to further this polic} r, which must be for the benefit of the community."