USED CAR PRICE PROBLEM STILL NOT SOLVED

Gisborne Herald, Volume LXXVI, Issue 22952, 21 May 1949, Page 4

USED CAR PRICE PROBLEM STILL NOT SOLVED

PJTHE Government, acting through the Price Tribunal, has decreed that it is illegal to sell motor vehicles imported since 1947 at prices above new values. Some measure of control of used car prices has been expected for a long time. Yesterday’s announcement, however, is a very inadequate approach to the problem. Not only is it too late to repair past damage, but unless heavy penalties are provided it is unlikely to go far towards preventing future abuses and, in any event, will still leave the causes of the present situation untouched. Used cars have been bringing fabulously high prices ever since New Zealand servicemen returned home from the war. For several years previously vehicles had been bought up cheaply and held in store for that very day. Fortunes were made by certain dealers throughout-the country but not always to their credit. This started the boom in used car sales. With the profits made more cars were bought. Bidding was competitive. Prices soared. The arrival of post-war imports of new cars opened up fresh avenues for sales in a market starved of vehicles, and despite the strenuous efforts of the trade to prevent unfair trafficking in these products abuses continued, and are still going on. Unscrupulous dealers in the cities today are offering large premiums for post-war cars with a low mileage and are reselling them at a huge profit.. For example, a city resident recently related how he had been offered £2OO more than he paid for an £BOO car of Canadian manufacture, which was subsequently to be sold to a taxi proprietor for £ISOO. He refused the offer, but he said that sales exceeding new prices by £4OO to £7OO were being made every day. It is this type of black-market business that the new regulations are designed to prevent. Dealing as they do with effects, not causes, however, they are a palliative and not a corrective. The remedy is an increase in imports, not a mere 25 per cent as was recently decided, but considerably more. Until this is done the general position may become worse, not improve, despite regulations.