Wednesday, March 28, 2012

Bringing back Smokey the Car

imageIt’s the Law of Unintended Consequences all over again.

NZers rely on a sophisticated second-hand market for imported, used, inexpensive Japanese cars. Government introduced new exhaust emission rules on all cars from January, 2012, requiring any new imported second-hand cars to have a much higher emission quality than previously.

The intention: to improve the quality of our air—and the quality of NZ cars in aggregate.

The result however has been very different.

Since the rules have come into force, many fewer cars have been imported than before, slowing down the refreshing of “the fleet.”  Prices of second-hand imported Japanese cars have already started to go stratospheric. And many car importers have either already withdrawn or are contemplating withdrawing altogether from the market, raising the prospect that the market for imported second-hand Japanese cars might either cease altogether or just dwindle to a trickle.

The result is predictable to everyone but the politicians: that impecunious car owners will be forced out of the market and will have to keep their own banger longer instead of trading up; that most car-owners able to stay in the market will keep their old cars longer before they do trade up; that new buyers will certainly have to buy much older cars than they would have otherwise*, at much higher prices than before; and the overall result of the new law is that NZ cars in aggregate will be older, more expensive, and with much worse overall emission standards than before.

And the easy to find, cheap but sturdy Japanese import that has transformed the lives of so many people could soon be a thing of the past.

It’s the Law of Unintended Consequences all over again.

* * * * *

* In recent years up to 150,000 used Japanese cars with an average age of 8-years-old have been imported. Meanwhile,  around 145,000 cars per year with an average age 18 years have been scrapped, with most of their components recycled.
Industry predictions are that only around 50,000 cars are likely to be imported in coming years, meaning many of those cars that would otherwise have been scrapped—perhaps up to 100,000 of them per year--will now have to remain on the road.
Great work from government, eh.

[Cartoon by Eldon Doty at Pat Hackett]

9 Comments:

Blogger Kiwiwit said...

I have never bought a second-hand Japanese import vehicle, having been put off in the early days by the massive odometer fraud that the authorities failed to police, however I have no doubt that the younger vehicle fleet was the main factor in the decrease in motor vehicle accident deaths in recent decades (and there is plenty of overseas research that shows that vehicle age and safety are far more important factors in reducing road deaths than heavy-handed policing of speeding, drink-driving, etc. So another unintended consequence of the Government's decision will be unnecessary road deaths.

3/28/2012 02:35:00 pm  
Blogger PC said...

No, KiwiWit, surely you realise the decrease in road deaths was entirely due to the increase in police speed traps.

Haven't you been listening to LTSA and Greg O'Connor?

3/28/2012 03:23:00 pm  
Anonymous Ruth said...

The emissions policy is just elitist nonsense - along with organics, carbon friendly wines, and other BS promoted in magazines such as "Mindfood" which I was reading at the hairdressers the other day. "Saving the Earth" in one article and the benefits of spending thousands on plastic surgery the next.

Our young people are now driving around in 20 year old cars which are costing us parents big bucks to keep on the road.

3/28/2012 04:37:00 pm  
Blogger Kiwiwit said...

Interestingly, (just to illustrate the disingenuity of road safety campaigns) I was recently talking to some senior officials in one of the government agencies involved in road safety enforcement and I made the observation that all their advertising seemed to portray middle-aged males of European extraction as the prime offenders (usually with a young Maori or woman looking on disapprovingly). They admitted that this politically acceptable (and lucrative) target demographic was significantly over-represented in speeding fines but significantly under-represented in death and injury accidents, suggesting that they are fast but highly competent drivers. They also said they could never publish this research.

3/28/2012 04:45:00 pm  
Blogger PC said...

@Ruth: It sure as hell is elitist, isn't it. Another attack on the working family's pleasures--as if driking and smoking didn't already cost them enough, now the cost of cars and driving is starting to go through the roof as well.

Where's the party of the working family when you need them?

3/28/2012 04:59:00 pm  
Blogger libertyscott said...

Back in MY day, this was the repeated advice given to Ministers.

Two of the biggest steps that reduced pollution and improved safety on NZ roads in the 1990s were:
- Allowing secondhand Japanese imports; and
- Abolishing tariffs on new vehicles.

Quite simply it meant that accidents were less likely to kill people, and cars became more fuel efficient.

There was also an important factor in spending on roads, because we had about a decade of non-politicised, but frugal, spending on roads, which focused on accident blackspots (successfully).

Allied to that was the wise decision to have graduated driving licences, which saw new drivers, by and large, undertaking less risky behaviour as they picked up skills.

The seriously politically incorrect story around road safety is that fatalities per km are disproportionate in Northland, Waikato and the East Cape/Gisborne region - the former and the latter primarily because windy roads are unforgiving for those who are drunk, stoned, driving carelessly or the like. Waikato has less of that, but the high density of heavy trucks and fast intercity traffic is unforgiving to those who drift across centre lines or treat driving on state highways the same as empty country roads.

Of course the existence of the ACC monopoly means nobody pays for their accident risk on an injury risk basis, and those who are most severely injured get relatively little (and it doesn't penalise the culprit). Whilst the mainstream of NZ politics still claims ACC is the "envy of the world", astonishingly.

3/28/2012 09:19:00 pm  
Blogger libertyscott said...

The Greens pushed for this when Labour was in power. This sort of law exists in Europe, but when you have a huge base of used cars across the EU to source secondhand vehicles from, it doesn't have the same scale of negative impacts as it does in tiny distant NZ.

The fact the Greens don't think this one through, and zombie like push for anything that appears "anti-car" says it all.

3/28/2012 09:31:00 pm  
Blogger Eric Crampton said...

The worse the better, as far as I'm concerned. Then I can assign a fun honours project looking at the effects on the aggregate emissions profile.

http://offsettingbehaviour.blogspot.co.nz/2012/02/emissions-elasticity-and-car-import.html

Always look on the bright side: bad policy gives us a chance to do fun little empirical projects that let us say "I Told You So."

3/28/2012 10:37:00 pm  
Anonymous V said...

This country pissess me off with shit like this, which penalises everyone for no tangible benefit, in fact it makes everyone worse off.

Time to axe these govt. depts that do nothing but meddle.
Anyone would think we are trying to aim for Burma where 1987 toyotas with broken windows still trade for $40,000.

3/31/2012 07:20:00 pm  

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