P.M. ‘attempting to make political capital’

Press, 18 February 1983, Page 7

P.M. ‘attempting to make political capital’

PA Wellington The Government seems only to be interested in trying to distance itself from any responsibility for the recent problems within the motor industry, says the Motor-Vehicle Dealers' Association. This comment came in a statement after strong criticism of the industry and its management by the Prime Minister. Mr Muldoon, last week. Mr Muldoon said the industry . had misread trends and ignored advice he had given repeatedly since 1976. In its statement, the association said it was unfortunate that Mr Muldoon should attempt to make political capital from the present depressed conditions affecting the entire economy, including the motor industry. “Although the industry had

foreseen lower sales in the second half of 1982, no-one in the industry or outside it could have predicted a dropoff in sales of the severity and speed that actually occurred, resulting as it did from many factors. Among those were long-overdue Government action to curtail the money supply which had been allowed to grow excessively in the pre-election period: the impact of the wage-price freeze on consumer purchase decisions; and not least, the grossly misleading publicity surrounding the Industry Development Commission’s

duty and sales tax recommendations. “While it is true that the Prime Minister has in the past indicated the Government’s preference for passenger car sales in New Zealand of 67,000 units annually, his own administration’s economic policies created the conditions where the public has been encouraged to buy cars well in excess of that rate.” Demand in 1981 grew to 89.500 and as independent businessmen, the motor assemblers hhve competed for sales in this market.’ Industry members could not see what advantage the Prime Minister saw in holding the industry to public ridicule as incompetent managers of their business. “Strangely, we hear no mention of the circumstances which have brought about a

stockpile of many thousands of television set’s with one manufacturer alone, representing a year's supply, or of lay-offs in electronics and many other consumer-orien-tated industries. “The Prime Minister will realise that the climate which creates public buying confidence is largely Govern-ment-created and manufacturers cannot be blamed for seeing that they have goods available to meet public demand at these times. “What is needed at this time is not political gamesmanship, but effective planning by the Government to establish the conditions necessary for industry to work withoout the unnecessary drastic fluctuations which have been the root cause of the present situation,” said the manufacturers’