JUMP IN CAR PRICES.

New Zealand Herald, Volume LXVII, Issue 20649, 22 August 1930, Page 12

JUMP IN CAR PRICES.

many makes affected INCREASE FROM £25 TO £SO. BLOW TO CANADIAN DEALERSGREATER BRITISH PREFERENCE. Drastic price increases in the majority of the cars on the market in New Zealand are inevitable if the new Canadian tariff rates announced yesterday are retained. The new schedule will more than doublo tho duty payable on Canadian cars and if this is passed on to the retail price in full, it will involve increases of from £25 to £SO in tho cost of cars in the so-called "popular" price class. Only three makes of cars, which have been paying the full tariff for American products, have been selling in large numbers in New Zealand, and the great majority of those prominent in the sales totals have enjoyed the rates of duty applied to English makes. So many familiar makes will be affected that the result will be the most sweeping jump in car prices experienced for many years. The effect is to give an increased preference to English cars and to decrease tho discrepancy between American cars and cars which have been classed as Canadian and admitted on the English basis in the past. Auckland importers of British vohiclcs were elated yesterday and claimed that tho action, which, they said, was overdue, would provide English manufacturers with tho opportunity they were seeking to secure a fair share of New Zealand's business. Dealers in the Canadian cars were staggered by the blow which had been suddenly dealt them. American car dealers were unperturbed, considering that, if anything, the move was in their favour. " Assisting Workers to Walk." "Tho Goverliment is steadily assisting the working class to walk," remarked one dealer, who pointed out that it was the low-priced car that was The new tariff would undoubtedly achieve its object and importers would be to cross the border and purchase in America, where tho price ex factory of tho same typo of vehicle was cheaper, owing to tho benefits of mass production and larger output. . , In the past the decreased cost in the United States had been more than offset by the lower duty which the Canadian car enjoyed as an Empire product. If the two countries wero placed almost on tho same footing it would be cheaper to buy direct in the United States. It might be that, the central firms in Wellington or other centres in the South which held tho Now Zealand agencies and indented for the whole of tho Dominion, were tied by contracts to take the product of the Canadian factories. This was not known in Auckland, as the central agency was solely responsible for the placing of orders for indenting cars. In one case, however, the effect would be seriously felt owing to the fact that factory manufactured no right-hand drive cars. These were produced entirely at the Canadian factory. The importation of left-hand drive cars, which were used in so many other countries to comply with the keep-to-the-right rule of tho road, was prohibited in New Zealand.

Low-priced Cars Aflscted. "It will add about £SO to the cost of the moderately-priced Canadian car." stated another dealer. He felt it was too early to give a definite opinion as to the general effect upon the motor business in New Zealand, but a shrinkage in the buying of new cars by the motoring public and higher costs generally were .almost certain to follow the operation of the higher duty. The Government was virtually holding the pistol to the Canadian Government's head, but this dealer thought it was doubtful if the would be fired. It meant so much to Canada that a compromise was practically certain. The view that the amended tariff would affect the small tradesman and the poorer man, who constituted the buyers of the lower-priced cars, was endorsed by the manager of a company which handles both Canadian and American cars. "On top of the increase in the petrol tax it is a shocking thing." he said. "It is a very bad thing for the small man and will mean that the average owner of a small business will be crippled as far as buying a new vehicle is concerned. There are no British light trucks on the market suitable to his needs, and he will practically bo forced to buy at the higher price."

The More Expensive Cars. The manager added that business firms which equipped their travellers with the lower-priced cars would also sniffer by tho increase. It was only the cheaperpriced cars of American origin which would be increased in price, as all the lower-priced cars of this type were built in Canadian works. Tho more expensive American cars, costing over 1.450 ill IScw Zealand, were in nearly every case built in the United States and their cost would not bo affected by the amended tariff, so that it was only'tho buyer whose purse was limited who would be called on to pay more. Tho man who could afford to buy a dearer vehicle would not suffer in any way. The same view was taken by the Auckland manager of another firm of dealers in both Canadian and United States cars. He said the bulk of importations from Canada was in the lower-price field, and the dearer cars would not be affected in the least. With the exception of one car, which was assembled in Now Zealand, all the higher-priced cars were imported from the United States factories. The Canadian factories were almost solely occupied in turning out a product selling at a low price. Large Canadian Imports. Canadian imports were by far the largest in the New Zealand motor import returns for tho six months ciulod June 30, moro than half tho vehicles coming from that source. Tho total number of vehicles landed in New Zealand was 8983 and of these 4570 came from Canada. A total of 3630 Canadian passenger vehicles, other than buses, were imported at a cost of £450,222. Other Canadian vehicles brought the total value of imports from that Dominion up to £554,990. Vehicles from the United States numbered 2836, valued at, £504.829. In 1929 Canada supplied 46 per cent, of tho cars imported into New Zealand and tho total value of all tho vehicles and motoring material purchased by New Zealand from Canada amounted to £2,371,400. In tho same year the United States supplied 3bJ> per cent, of the vohicles imported. The increase in the duty on tyres will be felt by practically all motorists, as last year 65 per cent, of New Zealand's requirements in this respect came from Canada.