Used Car Conspiracy Claims ‘Couldn’T Be Further From Truth’ 


Tribune Business Editor


CLAIMS of a “conspiracy” to force Bahamians to purchase more expensive vehicles “couldn’t be further from the truth”, the Chamber of Commerce’s chief executive said yesterday.

Edison Sumner told Tribune Business he wanted to “completely dispel the myth” that last week’s Standards Bureau-led visit to Japan, which assessed pre-export inspection processes for used vehicles shipped to the Bahamas, had any ulterior motives.

Multiple online responses on Tribune242.com to this newspaper’s reporting of the visit described it as an effort to “squeeze the small man” by raising the cost of used vehicles, with suggestions there was a ‘conspiracy’ involving Bahamas Motor Dealers Association (BMDA) members, the banks and government to drive Bahamians to purchase new vehicles.

This, numerous readers argued, would benefit the three parties involved in terms of increased sales, car loans and revenues at the expense of consumers, but Mr Sumner said mission’s sole objective was to protect the health and safety of Bahamians by enhancing the quality of vehicle imports.

“Nothing could be further from the truth,” he told Tribune Business. “The idea that this was a conspiracy is very far from the truth. Even from the private sector side, we’re seeking to improve the quality of vehicles on the roads of the country, and that has to be done through a very extensive testing process. “We want to make vehicles and amenities more affordable to the Bahamian public, but we want to do it in a way that not only allows them to access quality vehicles but ones that are roadworthy in every sense of the word and environmentally friendly.”

Mr Sumner, in his capacity as a Standards Bureau Board member, together with other directors and BMDA chief, Fred Albury, went to Japan on a week-long mission at the invitation of EAA Company, which conducts technical inspections on pre-owned vehicles prior to their export to the Bahamas and other countries.

The delegation assessed EAA’s pre-inspection process, with the company having offered a public-private partnership (PPP) “at no cost” to the Government to perform examinations of all Bahamas-bound vehicles for roadworthiness, emissions and radiation before they leave the dock.

At present, the Bahamas has nothing to certify the roadworthiness of used vehicle imports, creating potential health and safety problems for consumers, and a potential environmental hazard from the wrecks dumped on New Providence roadside.

Buyers in such instances do not receive ‘value for money’, and the ‘saturated’ market created by the influx of used auto imports also depresses sales/prices and government revenue.

Mr Sumner said there was no intention to force Bahamian consumers to buy a particular type of vehicle, or drive them to a certain segment of the market, as a result of the delegation’s Japan trip.

“There is no conspiracy going on,” he reiterated. “The Government, private sector and consumer protection agencies are all looking out for the betterment of the country.

“It’s going to be very important to articulate that very precisely and clearly as to how this will be beneficial to the average Bahamian. I would like to completely dispel that myth, and if there is any Bahamian out there that has that impression I want to say emphatically that’s not the case.

“This is to improve the quality of vehicles on the road in the country, and Bahamians driving at optimal standards in compliance with International Standards Organisation (ISO) standards that govern the use of vehicles in our country.”

Mr Sumner declined to comment on the delegation’s findings, saying he did not want to pre-empt a written report that was being prepared for Dion Foulkes, minister of labour, who has ministerial responsibility for the Standards Bureau and consumer protection, and Prime Minister Dr Hubert Minnis.

Tribune Business sources, speaking on condition of anonymity, described the Japan trip as “very fruitful and productive”. Dr Renae Ferguson-Bufford, the Bahamas Bureau of Standards and Quality’s (BBSQ) director, and who led the delegation, declined to comment due to the report being prepared for the policymakers.

Suspicions, though, continue to linger in some quarters over the Japan trip’s motivations. A Bahamian investor group that proposed an annual automated vehicle inspection process to the Government three years ago questioned why the Government was “running to Japan” when such technical examinations could be done at home by its own people.

Franklyn Robinson, a principal in the Bahamas Automobile Safety and Inspection Centre group, told Tribune Business that the delegation’s visit amounted to “a waste of taxpayer funds” given that his group’s proposal would accomplish the same thing and make pre-import inspections in Japan unnecessary.

“The question is: Why is the country running to Japan?” he argued. “It’s a waste of public funds to send a team from the Bahamas to do what the Bahamas should be doing itself.

“When I look at this invitation, I think it’s an attempt to somehow make it difficult for Bahamians to make a decision on where they spend their money and purchase their vehicles.

“Bahamians were forced into having to look at places like Japan due to vehicles being unaffordable in the Bahamas.... I feel that in a free trade system Bahamians should be able to go and purchase a car where they want to purchase a car.”

Mr Robinson conceded that high Excise Tax rates of 60-65 per cent were a major factor in pricing new automobiles beyond the reach of many Bahamians, driving them in increasing numbers to the used car market since the 2008-2009 recession.

However, Charles Beneby, his partner in Bahamas Automobile Safety and Inspection Centre, argued that new car dealers were making themselves “irrelevant” by stubbornly refusing to adjust their business model to consumer incomes and tastes.

“The Japanese market offers an opportunity to own a car without the heavy financing necessary to go through the local car dealers,” Mr Beneby said. “There’s a failure to see the obvious where car dealers are concerned.

“The market has changed, their model has not, and they’re becoming irrelevant. The guys on the corner are able to buy in Japan, bring them here and have replaced the dealers in the car market. It’s not sitting well with them.

“The Bahamian public is realising they don’t have to spend $60,000 on a vehicle to ride around in Nassau, and can get a $7,500 car with no financing, no overhead, no mortgage on the car. As a resident of the Bahamas, purchasing in Japan and the European market is providing me with a win-win.”

Bahamian new auto dealers would likely retort that they are having to compete on an unfair, uneven ‘playing field’ with street dealers who likely pay no VAT, NIB contributions, Business License fees and other taxes, and who do not incur their overheads and staffing costs.

But Mr Robinson, echoing Mr Beneby, added: “They have refused to adjust to the reality. The ability to go online and purchase a car has freed me from this dinosaur. Now the model has changed, they’re complaining.

“Our proposal provides the Bahamas with its own inspections regime. I don’t need somebody in Japan inspecting a vehicle for me. It’s the Bahamas’ responsibility to inspect a vehicle on Bahamian roads. It’s unnecessary, and I think it’s an attempt to further drive Bahamians to a certain segment of the business community.”

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