Monday, 26 October 2020 09:50

Vehicle importers enter buying and selling of cars for survival

Sri Lanka’s main motor traders including several franchise car dealers have been forced to enter the second-hand vehicle market which is being fully activated following the vehicle import ban, importers disclosed.

Six months after the imposition of the vehicle import prohibition regulation, many international branded vehicle franchise dealers have sold out all imported vehicles, they pointed out.

Buying and selling second-hand vehicles has become a lucrative business as people have no choice other than buying used cars at rising prices, a leading motor trader said .

Some of the leading franchise dealers are offering their showroom and other facilities for used car owners to sell their vehicles charging a commission from them, he added.

They are retrenching staff and closing down branches and dealerships in outstations as there are no prospects of new stocks arriving due to import restrictions, he revealed.

On the other hand the price of unregistered and registered vehicles has skyrocketed and the second hand car dealers are making maximum use of the current situation, Vehicle Importers Association Lanka (VIAL) President Indika Sampath Merenchige revealed.

The price of unregistered vehicles increased by Rs. 1 million and the price of registered vehicles too increased by Rs. 100,000- to Rs.500,000, he said.

He also advised the public not to purchase vehicles for an unreasonably high price. He said prices are high because of the present high demand and short supply.

Around 40 per cent of vehicle importers have become bankrupt as a result of the current situation; Mr Merenchige said adding that the price of used cars skyrocketed as there were no new vehicles in the market.

Following the imposition of the vehicle import prohibition, the increasing prices of the second-hand vehicle market cannot be controlled by the Government, Transport Services State Minister Dilum Amunugama told a recent official meeting.

The government is to continue the ban on vehicle imports for at least a year to sustain a possible foreign exchange crisis as average vehicle imports were in the region of US$800 million during the previous 13 years.

(LIN)

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