Overnight price risewith more on the way

Press, 11 September 1986, Page 25

Overnight price rise—with more on the way

As New Zealand’s motoring press corps flew into Wellington to sample NXM.Cs Austin Rover cars on a two-day jaunt north of the capital this week, it became known that the Honda Civic GT, flagship of the Civic fleet, had gone up $2OOO over the week-end. Now, hold your breath for the bad news. People close to N.Z.M.C. are predicting that the Civic GT will carry a price tag approaching $32,000 from October 1. Their forecast is based on a 6 per cent GST impost and a 6.3 per cent rise, based on upward predictions for the Japanese yen against the Kiwi dollar. As far as one can judge, ail Civic models should have gone up in price by about $2OOO last Monday, so one can expect them to rise again by about 12.3 per cent with the introduction of GST. Taking the Civics as an example, top-of-the-line locally assembled Honda Accords could be retailing for around $40,000 in October. Importers of completely built-up European cars could be laughing all the way to the bank soon.

At the beginning of the week, motoring writers had yet to learn how NXM.C.’s Austin Rover cars would be priced. However, there were good reasons for believing that the MG Metro Turbo, a two-door hatchback in the Fiat Uno Turbo tradition, would match the Italian speedster almost dollar for dollar. That would mean a figure around $28,969. The dramatic price reversal relating to locally assembled Japanese cars vis-a-vis imported builtup European cars, has led to speculation that Steel and Tube, which now owns N.Z.M.C, Ltd, will sell out its assembly

operation to Honda of Japan and direct its automotive efforts to retailing only. Much the same pattern

is being predicted for Todd Motors, Ltd, the Mitsubishi assembler, which also handies Peugeot under the Alliance Motors banner. Overseas ownership of the greater part of the local car assembly industry could be the pattern that emerges as a consequence of an ever-hard-ening yen and the weaker New Zealand dollar. -. Another factor that could be of some significance is the effect the goods and services tax will have on the local assembly industry. The opinion within the motor trade is that GST will not have such a profound effect on completely built up car price structuring as it will on locally assembled vehicles.