Damaged-car ban said under review - Auto traders see danger signals

Discussions have reignited on the suspended damaged-car import policy. And while the industry and commerce ministry is refusing to acknowledge the talks, auto traders say the ban could be lifted as soon as next month but are warning against it, saying it would re-energise the illegal 'chop shop' market and undermine driver safety.

The damaged-car trade was put on hold three years ago for policymakers to close loopholes at the ports and inside tax offices that allowed the smuggling of stolen and substandard vehicles.

Three independent sources, who each requested anonymity because of the potential blowback from black market traders, said that talks are sufficiently advanced that a date of September month-end has been floated for the lifting of the ban.

"It is coming online soon, probably next month," said one auto industry source. It's "a very thorny issue," said another.

On Monday, when the Financial Gleaner asked new Minister of Industry, Investment and Commerce, Dr Christopher Tufton, about the discussions, he said he was not prepared to speak to the issue at this time.

"I have not made any announcement, and until it goes to Cabinet I have no comment," said Tufton. "We have taken no decision; so even if discussions have been made we have made no decision."

The trade administrator at the Trade Board, Douglas Webster, also declined to comment.

However, a Kingston-based auto trader said the new policy will limit licences for damaged imports to brokers - individuals will no longer qualify; and that the policing of the trade is to be stepped up.

The ban on the damaged-car trade was imposed on May 1, 2008 after it became clear that "monitoring was impossible," said one auto seller. The trade had become a conduit for stolen vehicles, as well as substandard cars sold to unsuspecting buyers. It also fed the proliferation of illegal garages.

Stolen cars were often sloppily welded together, and vehicles involved in accidents were sometimes found to have undergone cosmetic repairs before being sold locally.

Car dealer Andrew Jackson said little has been accomplished in the three years to put checks and balances in place for poorly fixed vehicles.

"If they could find ways to differentiate between minor damage and major damage, then maybe it would work," said Jackson.

Another of our sources, who spoke on condition of anonymity, said some of the vehicles which appeared to be equipped with airbags, for example, were found to be just plastic covered over, said another dealer, who added that often the chop-shop vehicles were only known to be defective when accidents occur.

"The banks had a problem with financing as they were coming to pick up a wrangled mess," he said. "Unscrupulous persons would take fraudulent document with pictures of good vehicles to the bank to get loans, and when anything happens the banks lose everything."

The source said that none of the problems that were highlighted in 2008 have been resolved.

"They are coming back with the same old mess and nothing is being done about it," he said.

It was quite easy to bribe officers in the tax office to alter records, thus distorting the real status of the vehicles, the dealer said. "People are willing to pay thousands of dollars to weak officers for them to lift the clauses, and no kind of monitoring is in place."

Kent LaCroix, president of the New Car Dealers Association and the Automobile Dealers Association (ADA), said he did not know about the current discussions but warned that lifting the ban is "the worse mistake" the authorities could make.

"Unfortunately, we don't play by the rules properly and we are going to have people bringing in used stuff and don't fix them properly; and it will affect the people that will purchase them," said LaCroix.

"The ADA and the New Car Dealers Association are violently against it," he said.

marcella.scarlett@gleanerjm.com