Longer Resale Ban

Press, Volume CVI, Issue 31321, 17 March 1967, Page 3

Longer Resale Ban

“The Press" Special Service WELLINGTON, Mar. 16. The Government will soon extend the oneyear covenant against private resale of new cars and station waggons to two years. The move is intended to soften the impact on the car market of the pending 20 per cent cut in imports of completely-knocked-down cars.

The Minister of Customs (Mr Shelton) confirmed the extension of the covenant period last night. He said twoyear covenants were being prepared and would be introduced as soon as possible, once administrative arrangements had been completed. The present covenant requires buyers to undertake not to dispose of a new vehicle within a year of purchase without first offering it to the original dealer at a depreciated price of £l2 for every 1000 miles, with a maximum of £2OO and a minimum of £75. 30 Per Cent Cut For cars and other motor vehicles except heavy trucks, which are “free” imports, there will be a 20 per cent reduction from July I—on top of the 20 per cent cut in the present year, trade sources reported this week. The total effect will be a 36 per cent reduction since 1965-66.

No-remittance car imports are not affected by the licensing schedule and will to some extent cushion the effect of the cuts in licensed imports. Recently, about 1000 cars a month have been coming into New Zealand under noremittance procedures. . Recently imposed exchange controls require a surcharge in privately held overseas funds to be' repatriated through the banking system with each no-remittance import and are aimed ultimately at abolishing this form of importing.

The initial effect, however, : has been to bolster it, according to the motor trade. Buyers already have to sur- : render an extra 15 per cent in exchange on the value of , their no-remittance licences, ■ but apparently they are mindful that the surcharge will double to 30 per cent on July ; 1 next year and that by then there will be a tougher clamp on ordinarily licensed im- . ports. No-remittance imports will ■ probably mean that the total • reduction in the volume of i cars imported this year will be nearer 15 per cent than 20 per cent. The total volume of new car registration was 67,745 in 1965-66. In the coming year the figure may be down to about 45,000.