KARACHI, Nov 22: An ECC decision of reducing the age limit of used cars import from five to three years has been hailed by local assemblers and vendors, but importers have rejected the move.

Pakistan Automotive Manufacturers Association chairman Pervez Ghias said that the government had acted decisively in the larger national interest, and it was necessary for local industry’s survival.

He expressed the hope that the Auto Industry Development Programme would also be approved, giving the industry an impetus for growth.

Balochistan Wheels’s GM sales and marketing Shiakh Mohammad Iqbal said the decision would help local auto industry boost sales, create jobs and transfer of technology.

He said that dealers of used cars are not stakeholders and the government should impose a ban on them for misusing the policy of import of used cars.

Overseas Pakistanis be advised to get their cars cleared from the customs with clearing forwarding agents.

To avoid misuse of gift baggage and transfer of residence scheme, the government should impose a ban on transfer / sale of cars to any other person for one year from the date of import of the vehicle in Pakistan.

All-Pakistan Motor Dealers Association Chairman H.M. Shahzad saw monopoly of car assemblers after the reduction in the age limit of used cars, coupled with an increase in prices and black-marketing.

He said that the government would lose over Rs30bn in terms of revenue from used car imports.

The ECC decision is tantamount to complete closure of used car import business as three-year old cars are costly in Japan while the present depreciation policy would further make used cars costlier by Rs150,000-200,000.

From July 2012 to November 22, import of used cars stood at around 20,000.

He urged the president and the prime minister to reconsider the decision.

He added that the consumers would be denied their right to buy a good quality car of their own choice with all accessories and safety features at an affordable price.

Zeeshan Afzal of Top Line Securities recalled that due to the relaxation of age limit, used car dealers imported approximately 56,000 units in FY12 as compared to 20,000 units in FY11, making an adverse impact on local automobile industry.

Due to availability of a cheap substitute and rising inventory levels in the market, local auto industry sales declined by 31 per cent to 40,000 units in 4MFY13 as compared to 59,000 units in the same period last year.