THE JAMAICA Used Car Dealers Association (JUCDA) is warning that newly introduced restrictions on the importation of used vehicles will lead to the demise of the industry, if they are retained.
President of the JUCDA, Kenneth Shaw, said the recently imposed regulations, which would require them to import motorcars no less than three years, and four years for pick-ups and light trucks, "would no doubt cause serious impact (on) our industry." He explained that "50 to 60 per cent of the stock that most used car dealers carry is made up of four and five-year-old units and when we are not able to import our stock..., more than 50 per cent of our earning capability would be taken away from us."
The JUCDA highlighted the significance of the used car industry to the economy. "It would be an unfit end to an industry that has evolved, developed and generated massive inflows to the government's coffers over the past 11 years...," Mr. Shaw argued at a press conference held at the Pegasus Hotel in New Kingston on Friday.
UNDERGROUND CAR TRADE
JUCDA vice-president, Dwight Moore, warned that this action by the Government is most certain to revive the underground car trade.
"You can be assured that with these regimes, it means that a lot of these cars that are sound, viable that we could import, people are going to bring them in as parts and reassemble them," Mr. Moore emphasised. The predicament, he said, resulted "because of the sliding dollar and because of the Government's unwillingness to co-operate with the WTO (World Trade Organisation) ruling..."
The JUCDA says that the dilemma has been further compounded by the four per cent cess imposed on imported goods and the continuous depreciation in the value of the Jamaican dollar.
In light of the situation, Mr. Shaw said there will be "downsizing, layoffs would be imminent and closure in some cases." He pointed out that two dealers, one in Negril and another in Manchester, have already closed their doors due to increased taxation and increased competition. The JUCDA said they are in total support for the removal of the four per cent cess on imported goods.
AN ALTERNATIVE
As an alternative to the cess and the age restrictions on used vehicles, Mr. Moore is proposing that the government apply a special gas guzzler tax on vehicles that carry six cylinders and over. In addition, Mr. Shaw said, "dealers would be willing to give additional warranties (if rollback is granted) on these four and five-year-old vehicles to ensure maximum satisfaction for the consuming public."
In the meantime, the JUCDA said it will be pressing for a meeting with Finance Minister, Dr. Omar Davies, to discuss the situation with a view of finding an acceptable solution.
