Used car price hike fear drives panic buying
Reports by various media outlets last year, including Stuff and The Northern Advocate, claimed used car prices could rise by as much as 50 percent, but car industry commentators dismiss the claims and say cheap cars will still be available for first-time buyers.
This is despite statistics from Turners Auctions showing the average price for a car has risen by 29 percent bewteen 2007 and 2011, and the number of vehiclessold has decreased by 72 percent.
Victoria University law student Katrina Sudfelt (above), 23, is looking at buying a car early because of the reports.
“I was thinking of buying a car next year. However, I have heard the prices of cars are going up, so I’m saving quite hard so I can buy one this year.”
However, Automobile Association motoring policy team leader Mark Stockdale says new emission standards will not affect the price of used vehicles, says
“While the new rule does restrict used imports built before 2005, there are already ample vehicles in the affordable age and price range in NZ that will continue to be available on the used car market, and prices of these are unlikely to rise,” he says.
Instead, he says higher-standard vehicles will become safer, cleaner, and eventually cheaper, as the newer cars will be more fuel efficient.
Fairfax New Zealand group motoring editor Dave Moore says cheap, second-hand cars will now be sold and bought privately rather than through dealers.
“There will still be an awful lot of stock.”
He says the likely effect of the emissions scheme will be that buyers will look more closely at what a potential car can provide.
“Previously we tended to buy our cars to impress our neighbours, rather than to fill our needs.”
“It will be that buyers will look very carefully at the size and function of the car – often small cars are ignored.”
With the rumour mill on high steam, some young buyers have accelerated their decision to buy vehicles.
The story is similar for Anna van Herk, 23 – who will pursue full-time study in Christchurch this year – says if it were not for her cousin selling her 1994 Holden Barina Swing she would not be able to afford her first car because of predicted price hikes.
“I wouldn’t have considered buying a car if my cousin wasn’t willing to give me a really good deal – she’s moving overseas.”
Adding to the panic are fears that the 2011 Japanese earthquake and tsunami, which devastated multiple car manufacturing plants, has severely limited imports.
But Mr Stockdale is unconcerned about the decreased Japanese market, as he is confident Europe can easily make up the short-fall, especially with more fuel efficient diesel vehicles.
“The AA has been disappointed that the import industry has hitherto not been offering New Zealanders the most fuel efficient, affordable vehicles that are available, because of their narrow focus on the Japanese used car market.”
The Emissions Trading Scheme was announced in 2007 by the then Labour government in a bid make New Zealand more environmentally friendly, and reports in the media concerning the looming price rise have been constant.
The new rules limit what vehicles may be imported into New Zealand: any vehicle made before 2005 is prohibited from being imported.