Rising compliance costs are pushing used import vehicles beyond the reach of the very buyers they serve best. 

The Imported Motor Vehicle Industry Association (VIA) says regulatory-induced price pressure is making once-affordable vehicles increasingly unattainable for ordinary households. VIA Chief Executive Greig Epps says the problem lies not only in global trends but in the design of local policy. 

“The Clean Car Standard is not fit for purpose when applied to used imports,” says Epps. “It was designed for new vehicle markets where manufacturers can generate credits through increasing production of low-emission models. Used importers cannot do that because we work with what already exists overseas.” 

Total imports have risen 12 per cent on last year, but this is from historic lows, and the recovery since COVID has been uneven. In the current quasi-recessionary context, it is odd for new vehicle registrations to be leading the rebound, while used imports remain stalled.  

Epps says that is because CCS penalties are soaking up the few remaining credits held by used importers. “By the end of this year, penalties will completely offset the credits available to used importers. Around half of penalised stock carries extra costs of over $1,000. On a $12,000 car, that is often the difference between yes and no for a buyer.” 

The association’s submission to a recent hearing of the Transport and Infrastructure Select Committee notes that the average retail price for a used import in New Zealand has held steady at about $15,000 for several years. Prices are inelastic because Kiwi wages remain low; importers have already trimmed costs as much as possible through vehicle age, mileage, and auction grade. Additional penalties pass through to customers. 

Affordability squeeze 

Retail sales data confirms that the “sweet spot” for affordability, a nine to ten-year-old car priced around $15,000, is disappearing. Existing levies from the CCS will soon be compounded by shifting to Euro 6D emissions criteria, and proposals to mandate certain safety features.  

VIA warns that by 2028, up to 75 per cent of currently viable models could be ruled out by overlapping age and emissions limits. 

This is not just a sector issue. Epps says when affordable used imports disappear, households keep older, higher-emitting vehicles longer. “It slows the very emissions progress the policy was supposed to accelerate,” he says. “Families are being priced out of safer, lower-emission options.” 

Practical steps the industry is calling for: 

1. Create a separate used-only Clean Car Standard. 

VIA proposes distinct targets for used imports based on real supply conditions in Japan, where most used vehicles originate. This would align targets to what is realistically available rather than penalising vehicles that meet family needs. An import should be better than the vehicle it replaces. 

2. Remove the CCS target weight adjustment. 

The current formula rewards heavier new vehicles and penalises smaller, lighter used ones. VIA says this distorts the market, raising the cost of the very vehicles that help ordinary New Zealanders stay mobile. 

3. Review penalty and credit settings annually. 

Regular review would allow adjustment as newer, cleaner vehicles enter the Japanese used market, ensuring emissions targets remain achievable without cutting supply. 

Wider context 

 Economists say overall car registrations are trending upward but remain below pre-COVID levels. What’s unusual is that the new-car market is leading the recovery. In most slowdowns, the used sector bounces back first because it’s more affordable. 

For VIA, that reversal confirms the affordability problem. The organisation’s analysis shows a 45 per cent drop in imported six to seven-seat vehicles since 2023, removing many of the family-sized options once central to the market. 

Epps says the solution is not to abandon environmental goals but to tailor them. “We support cleaner, safer vehicles. But the policy cloth must be cut to fit the market we actually have, not the one we hope for in ten years’ time.” 

 

For more information: www.via.org.nz