Ward's Automotive International / February 15, 1996
By Larry Luxner
The Peruvian government has decided to prohibit the importation of used cars and trucks effective Jan. 22, with the exception of vehicles currently awaiting customs clearance, donations or imports of used vehicles made by the public sector, and vehicles used by foreign diplomatic missions.
Manuel Vara Ochoa, who was recently named transport and communications minister by President Alberto Fujimori, says the used-car ban is a temporary measure, to be reviewed in 90 days.
Octavio Mavila, president of the Asociación de Representantes de Automotrices del Perú, told local journalists his group agrees with the government's action, "not only because it will protect the end user, but also because it will solve the transportation chaos that currently affects the population." He said that the import of used vehicles permitted the introduction of vehicles in poor condition, and cars in which the right-side steering wheel was changed in repair shops to the left position, endangering drivers and passengers.
On the other hand, Sergio Luna, president of the rival Asociación de Importadores de Vehiculos Usados del Perú (Adivper), warns that the law will immediately force prices of used vehicles up by 30%, affecting more than 1,800 importers.
In addition, said Luna, only 2% of Peru's 22 million inhabitants can afford to buy a new vehicle costing $10,000 or more. The average used car sells locally for $4,000 to $9,000, while a new Nissan costs $16,290 and a new Toyota Corona as much as $32,500.
Nevertheless, the country enjoyed GDP growth of nearly 7% in 1995, making Peru one of Latin America's fastest-growing economies. As a consequence, approximately 105,000 vehicles were imported into Peru last year, of which 75,000 were used. In fact, used-vehicle imports jumped 54.68% in 1995, after climbing 38.23% in 1993, 33.57% in 1992 and 16.69% in 1991.
But that's nothing compared to the first nine months of 1995. According to official government figures, imports of used autos rose from 13,659 to 38,169 units (a jump of 179% over the comparable period in 1994), while imports of used pickups climbed from 5,550 to 14,329 units (a 158% increase), used trucks from 2,271 to 5,508 units (up 142.5%) and used buses from 274 to 707 (up 158%). In dollar terms, that comes to $190.8 million worth of used cars, $114.6 million in used pickups and vans, $140.2 million in used trucks and $17.1 million in used buses.
At present, 50% of all imported used vehicles come from the United States, another 35% from Japan and the remaining 15% from Europe. Officials say used vehicles now make up 8% of Peru's total vehicle market.