Dollar-decline damper - Auto imports fall as currency rates rise
Chad Bryan, Staff Reporter
Imports of new and used automobiles have decreased markedly, with the downturn attributed mostly to the continuing slide of the Jamaican dollar against the benchmark United States currency.
President of the Jamaica Used-Car Dealers Association, Lynvalle Hamilton, and Automobile Dealers Association head Kent LaCroix told a similar tale of declining fortunes for the new and used-car sectors.
"The sliding dollar is obvious, so it makes cars more expensive," said Hamilton. "Based on what is happening in the economy, persons have less disposable income, especially the public-sector workers. They have had a wage freeze for quite a while," he said. The wage freeze has had a severe impact, even though the public sector workers benefit from a 20 per cent duty concession.
LaCroix said, "I do not have the precise figures with me, but it would be less. Anything that is being imported will be affected by the sliding dollar."
Hamilton pointed out that not only did the slide in the dollar affect imports, but also persons' choice of motor vehicles. "Persons seeking SUVs and certain types of models such as the Toyotas and Hondas, they are much more expensive than other brands. That would cause them not to be able to qualify for loans. Another thing, too, is that the time taken to repay loans is much shorter (for used cars) than the new-car dealers," he said.
Letter to finance minister
When questioned if the Government had been approached for any assistance in addressing the situation, Hamilton said that a letter is to be penned to the minister of finance.
"We have intentions of writing formally to the minister, but we have been on the air voicing our opinion, and we do believe that some adjustments will be made to import duties to facilitate lower car prices. I believe in a 10-20 per cent reduction overall - not on all, but on those vehicles over 1,000cc and on hybrids, which are very fuel efficient," Hamilton said.
He added that in the last quarter, car prices in Japan increased due, also to the depreciation of the Yen, making vehicles from that country more expensive.
On the other hand, for new-car dealers, LaCroix does not believe in going to the Government.
"We haven't approached them. Any time there is a problem, everybody says the Government should reduce the duties. I think what we should do is manage over business properly. We can't keep calling and begging and begging," LaCroix said.