Educating consumers to make an informed choice on cars

Since I have been verbally attacked and pilloried by both Martin Ellul, vice-president, Used Vehicle Importers Association (UVIA) (The Sunday Times, September 28), and UVIA's legal counsel, Dr Emmanuel Mallia, I would like to reply to a few of the points they raised.

I also made it a point to attend UVIA's press conference yesterday week at the Radisson SAS Bay Point Resort and asked the most questions after Dr Mallia addressed the journalists and the 28 UVIA members present (I still await the list of these members from Dr Mallia), including some of the association members' clients who brought along their cars that were put on display both inside the Radisson's ballroom and in the car park outside.

Having covered the car business in Malta for the past 15 years, and having last commented on this subject in my monthly editorial in The Sunday Times Motoring two years ago, I believe I am informed enough to have an opinion - as an editorial is meant to portray. On UVIA's own admission, the association is new on the scene, having been incorporated only last May.

That Mr Ellul's article and Dr Mallia's intervention at the UVIA press conference were themselves full of sweeping statements, like the one that I did not make "a thorough verification and assessment of facts" and that my assertions were "outrightly unfounded and fraught with inaccuracies and misconceptions", is up to the reader to judge.

UVIA is attacking me for supporting the importation of new cars. Given a choice - and all consumers have this choice - I would opt for a new car. That is my free choice, and in a democracy I am 'allowed' to say that, even if this "serves directly the interest of third party competitors of our members", primarily importers of new cars. To call my editorial statement about vehicles built in Japan for the Japanese market as having different specifications to those that are built in Japan for the European market "not correct" is totally gratuitous. UVIA's justification is third party certification enabling them to conform to Malta Transport Authority (ADT) specifications.

If the second-hand cars imported by UVIA members were built to European spec., they would not need Single Type Vehicle Approval (STVA) certification but a Certificate of Conformity (CoC). The issue of certification is totally separate to the basic engineering specification of an individual car.

Specifications vary from market to market - this is an undisputable fact - and some of the vehicles imported, which were never designed or built for the European market (or to conform with European regulations) in the first place, cannot be said to have the same specifications. I am prepared to mention make and model.

I have no doubt that some second-hand car importers offer a six-month to one-year guarantee. I cannot understand how it is "misleading" to state that such a warranty would be inferior to a two- or even three-year warranty offered by some importers of new cars. There is just no comparison.

UVIA had no response to my reference to "after-sales service". Understandably. If a vehicle is still under warranty, and you are lucky enough to find that the dealer who sold it to you has not gone out of business or moved on, an identical 'stock' second-hand car will be cannibalised for the part you are after.

Another major issue that stems from this is that of insurance. Many sporty second-hand cars that are being bought by inexperienced 18-year-olds are simply not being insured and I have it from a senior insurance executive that insurance companies find great difficulty sourcing the parts needed to repair the wrecks after these cars are involved in accidents.

I can supply UVIA with actual makes and models, should they need me to elaborate on this point.

It appears that the MoT option in Cyprus has been hurriedly dropped in favour of certification by a UK agency called the Vehicle Certification Agency. Nowhere in my article did I state that Japanese cars are inferior or that second-hand cars imported are defective in any way.

What consumers clearly need to be informed about is that these cars are based on technology that is older and, in many cases, although some of the models are current and still in production, still others have been superseded by newer models or have actually gone out of production. Although externally, the model may look the same, the engine will simply not comply to European emission standards.

I fail to see how the statement that "people (are) spending Lm7,000 and more on second-hand cars" is "seemingly one-sided and severely prejudicial". Although the "most popular" models fall within the Lm3,500 to Lm4,900 price bracket (a price bracket for which new cars are also available in abundance), there are clearly also a minority of customers - several hundred - who are paying more because (in their opinion) they are 'saving' thousands of liri compared to the new price of the same model (if it is marketed in Malta in the first place) with inferior specifications.

Again, to be concrete with a practical example on an everyday car, the Toyota Starlet and Tercel was never imported by the local agent with a diesel engine. These are the sorts of engines that are Euro 1 and I challenge UVIA to show me an imported second-hand car that is Euro 4 emissions compliant.

When I call for a level playing field, it is absurd to expect second-hand importers to have the same facilities as new car importers. This would simply give UVIA members an even greater advantage. How many vehicles imported by UVIA members are actually invoiced at the vehicle's true, full value, including their many accessories?

UVIA state that last year its members contributed Lm6 million in customs duty and VAT, and a similar amount in the first eight months of this year to the Exchequer. This should be an issue of concern to Government because a large proportion of this revenue could have been much higher if an equivalent new car had been bought (quite apart from the environment effects). Not only. Since the majority of the values of second-hand cars sold are in the Lm3,500 to Lm4,900 price bracket, this is clearly not a 'social cases' bracket.

With regard to facilities, I have no doubt that some UVIA members have lovely showrooms and garages built from the profits they have made over time from their business. But UVIA cannot deny that there are second-hand car dealers who sell their cars on centre strips or parked in the open air on the kerbside.

Finally, with regard to the numbers and right-hand-drive markets where Japanese second-hand cars are exported to, the figure mentioned for the UK is just 0.8 per cent of the total market, a far cry from the percentage market share secured by UVIA members and other second-hand car importers.

The whole issue of second-hand car imports is clearly one with a lot of money at stake. This issue revolves around a few people making a lot of money from legal loopholes affecting every single person on our islands. These loopholes need to be closed.

The effect on the overall second-hand market is being ignored, including the lost capital due to faster depreciation to the car rental market, and Dr Mallia specifically declined to answer my question on the effect of second-hand commercial vehicles, which have practically taken over the market, annihilating this source of revenue for the new car importers.