Used Car Prices May Rise

Press, Volume CVIII, Issue 31726, 9 July 1968, Page 1

Used Car Prices May Rise

Used car prices may rise about 5 per cent in the next few months, according to Christchurch dealers. The dealers say that prices have firmed in the last few weeks, and that the increases will be caused by devaluation, the easing of hire purchase restrictions, and the recent changes in the regulations governing the use of overseas funds for the purchase of new cars.

Some dealers expect that the prices of used American cars will rise because few more new American models are likely to be imported. Devaluation, on top of the already high duty on American cars, had priced them off the market, one dealer said. Chevrolets and Pontlacs will not be assembled in New

Zealand after about two months, and the Rambler is likely to be the only American model available.

The prices of six-cylinder cars are also expected to rise slightly. This is because both Ford and General Motors—except for the Holden division—are expected to concentrate on four-cylindei models in the new car field. Faced with the choice of importing 60 six-cylinder cars or 100 four-cylinder models, they are expected to choose the bigger number of cars. “I do not see that the prices of used cars will rise very significantly during the rest of this year,” the vice-presi-dent of the Canterbury branch of the Licensed Motoi Vehicle Dealers’ Association (Mr S. Christenson) said yesterday.

June had been a good month for used-car sales, and this was the result of the easing of the hire purchase res-

trictlons, Mr Christenson said.

However, the initial rush to buy was now ending, and sales had eased in the last two weeks, although they were still at a good level. Stocks of good used cars had also been very low in June but this situation had improved in the last two weeks.

From the beginning of this month, persons using overseas funds to buy a new car have been required to repatriate to New Zealand 30 per cent of the sum paid as overseas deposit Until July the repatriation figure was 15 per cent New-car dealers say that non-remlttance sales in June, before the 30 per cent repatriation came into effect, were “phenomenal”. They still expect to get a reasonable number of non-remit-tance sales. The 30 per cent would not

hurt many non-remittance buyers, but would hurt the “oncers” —persons who had a small legacy or small amount of overseas funds which they hoped to use to buy a car, one dealer said. “First the feast and now the famine,” he said, referring to the record trading in June.

A spokesman for one large firm selling both new and used cars said that the increased prices of new cars—caused by devaluation—had driven many buyers to the better class of low-mileage used car “. . . which they would not have looked at a few months ago.” The change in the nonremittance market could mean fewer new cars coming into the country, if other licensing provisions remained unchanged, and thus a shortage of good used cars in a year or so, with a consequent rise in prices, he said.