MIXED REACTION

Press, Volume CXI, Issue 32779, 2 December 1971, Page 1

MIXED REACTION

Motor-trade reaction in Christchurch to the Government’s announcement yesterday on car imports could be best described as mixed. But tiie opinion of one industry spokesman was generally shared: “It won’t make any damn difference,” he said.

New Zealand assembly plants were already working to full capacity, the spokesman said. It would be a long time before more plant capacity could be provided. That plants had been working to capacity had been virtually acknowledged by the Government when it had allowed two built-up licence additions in the last two years. On their reading of the Government’s announcement, spokesmen said it appeared that companies which now assembled cars in New Zealand would no longer be able to import built-up cars. This seemed unfair, they said. The built-up licence was apparently to be granted to those companies which did nqt have assembly plants—those which had. in fact, been bringing in the bulk of

no-remittance cars would apparently be denied the chance of bringing in some of their less than “bread and butter” lines. WELL FILLED As far as cars imported built-up by firms without assembly plants in New Zealand were concerned, showrooms were well filled with

such cars now, one spokesman said. The really soughtafter built-up cars were, in the main, models for which franchise was held by companies already assembling other models in this country. Some dealers also said they hoped the Government’s

annoimcement did not encourage would-be car buyers to .play a “wait and see” game.

“Anyone who says he will wait until next year and be able to twist his dealer’s arm is going to fall flat on his face, because if the move does have its desired effect the price of used cars will drop, but the price of new cars—over which we have no control—will not. They have been going up at the rate of about 10 per cent every year.” Dealers said it was possible that the demand for new cars would be restricted by the rising price of new cars and the falling price of used cars. USED CARS But some spokesmen felt that any fall in used car prices would not be great, and would be gradual in com®g—not least of all because the Government’s decision was not going suddenly to increase the supply of new cars.

In the meantime the only thing which would increase the supply of cars notably would be the importation of extra built-up units, spokesmen said.

Hie only person likely to benefit if used car prices did fail, would be the person buying his first used car—he might gain by waiting until the middle of next year. But if he was also selling a vehicle he could expect to get less for it, and lose advantage.

Buyers were not having to wait very long even now, a major dealer for popular

models said. “If a buyer came in now, we could fix him up before Christmas.”

Another dealer said the increase in the price of new cars recently had “opened the gap” between new and nearnew car prices, and there was unlikely to be any radical change in used car prices. This was also suggested by the situation in Australia, he said, and any change would not be as drastic as many people seemed to believe. Nor should new car buyers expect the same sort of new car trading as occurred in Australia, with discounts of $3OO and more on the price of many new cars to “get them moving.” “There’s not a chance of this in New Zealand while we have price control.”

What amounted to the virtual freeing of New Zealandassembled cars from licensing would “sort out the sheep from the goats” as far as various car models were concerned, and also as far as some dealers were concerned, the spokesman said.