(Trinidad Guardian) In a move expected to shake up the foreign used car industry, Trade Minister Paula Gopee-Scoon yesterday announced a new policy which bars the importation of gasoline-powered vehicles more than four years old. Previously, foreign used car dealers were allowed to import vehicles that were up to six years old.
The policy, which takes immediate effect, also restricts prospective buyers importing cars for personal use to doing so every four years instead of every three years.
“The decision was also taken that the current age limit of three years for diesel-powered cars and four years for CNG-powered cars which are allowed for importation be maintained,” the minister said during a media briefing at the ministry’s offices at Nicholas Towers, Port-of-Spain.
Gopee-Scoon said the application process for any new person or business seeking to register as a Foreign Used Car Dealer has been temporarily suspended as the Trade Ministry is currently undertaking a comprehensive review and audit of the existing policy. The review, which will include discussions with relevant stakeholders, will be concluded by March 31.
The minister acknowledged that the foreign used car industry has made a tremendous contribution to the country’s economy via increases in employment and income generation, as well as making vehicle ownership affordable for many lower and middle income families.
She said: “The importation of foreign used cars has contributed considerably to the growth and development of a number of related downstream activities in the industry, including servicing and repair of cars, trading of spare parts and tyres, tint and graphics and the supply of ancillary accessories for cars such as alarms, audio systems, customising and auto body works.”
However, she added, there were also challenges, including the failure by some dealers to comply with the terms and conditions for registration of their dealerships
Gopee-Scoon said there has been a proliferation of people operating as unregistered dealers who are evading taxes resulting in lost revenue for the Government. She added that the unregistered dealers were operating unscrupulously at the expense of consumers.
Responding to concerns raised by officials of the T&T Automotive Dealers’ Association (TTADA’s) earlier this week, the minister said she did not believe the industry would be hampered.
“I know there are vehicles on the sea at this time which are coming on 2015 licences. We have an audit being done at this time and we are aware that there are vehicles at the places of businesses. I do not know about this shortage that TTADA is speaking about,” she said.
Gopee-Scoon also denied that large numbers of employees in the industry were in danger of losing their jobs.
“We have not cut down on the ceiling of cars being brought into T&T at this time. Market conditions will dictate the industry,” she said.
However, TTADA president Visham Babwah, in an immediate response to the revised policy, described it as draconian and said it would result in the death of the industry.
“Historically the PNM Government in past and present incarnations has always been against the foreign used car industry and has always backed new car dealers,” he said.
“When they lower the age of used vehicles to four years this will make used vehicles unaffordable. The small man will not be able to afford a used car which can sell as low as $60,000.
“For this Government to go against the policy without consultation is just the tip of the iceberg of what they plan to do with other policies. Our members will hold consultations and we will decide if we have to go back to court to get this decision overturned.”
Babwah said spin-off businesses in the industry would suffer and he wondered about the plight of dealers with vehicles on the port waiting to be cleared.
Noting that the new car industry had recently been identified by former Central Bank Governor Jwala Rambarran as one of the highest users of foreign exchange in T&T, he asked: “Why are they not squeezing new car dealers? The Government is just using convenient excuses to close down the industry because of the PNM policy to squeeze the small man. The process has already started with food items and property tax to create a society of have and have-nots.”
