Used-car market drying up

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CUSTOMS CHIEF CHECKS ON CLASSY CARS Customs Commissioner Ruffy Biazon examines a Corvette Stingray, one of the hundreds of imported used cars at the free port in Sta. Ana, Cagayan. He has asked President Aquino to issue an executive order to settle two allegedly conflicting orders on the importation of second-hand cars for resale in the country. INQUIRER/ MARIANNE BERMUDEZ

STA. ANA, Cagayan—Buyers of imported second-hand cars and vans have begun canceling orders in what vehicle dealers said was the aftermath of the controversial Supreme Court ruling that banned the importation of used cars at the  Cagayan Special Economic Zone and Freeport (CSEZFP).

Jaime Vicente, president of the Automotive Rebuilders’ Industry of Cagayan Valley (Aric), said some of their clients had called to discontinue their purchase of preordered cars, even before the arrival Saturday of the latest shipment of used vehicles.

“The damage has been done. We do not know if we can sell those vehicles even if we [are allowed] to dispose of them,” Vicente said, referring to the more than 700 units covered by the revived ban on the processing of imported used cars and vans.

The Bureau of Customs (BOC) and the Land Transportation Office this week ordered their field offices in Cagayan to stop processing the papers of used vehicles that arrived here on Feb. 11 and that of the shipment arriving Saturday, following the recent Supreme Court ruling that reaffirmed the validity of Executive Order No. 156.

The order, issued by former President Gloria Arroyo in 2002, prohibits the importation of used vehicles including those coursed through free ports, except those used by returning immigrants and members of the diplomatic corps, as well as buses, trucks and special purpose vehicles such as ambulances and fire trucks.

Sought for comment, Nilo Aldeguer, senior deputy administrator of the Cagayan Economic Zone Authority, the agency tasked to manage and supervise CSEZFP operations, said the buyers’ reaction was expected.

“That is the prerogative of car buyers, which will result in [business] losses [to] our locators if the order to suspend processing by the BOC is not reconsidered,” he said.

‘Completely absurd’

In a statement, Vicente also dismissed “as completely absurd” the claim that the second-hand auto industry here had been affecting the sales of the country’s major car manufacturers.

“Considering the reported phenomenal growth in yearly sales of brand new units in the Philippines amid worldwide recession, the notion that our business activity [at the CSEZFP] impedes the growth of the [country’s] vehicle industry as a whole is completely absurd and tends to stretch one’s minds into incredulity,” he said.

In a phone interview, Vicente said used-car importers were preparing for an expected slowdown in their business, as the government’s pronouncements had been scaring off prospective buyers.

“Buyers are now coming [only] in trickles … Before this problem broke out, sales had been quite good almost on a daily basis,” he added.

Conflicting provisions

Vicente’s statement came on the heels of requests by used-car dealers for government to reconsider the ban, citing what they said were conflicting provisions in the application of EO 156 and EO 418.  EO 418, signed by Arroyo in 2005, modified the tariff rates and import duties on imported used vehicles.

The Aric interpreted the provisions of EO 418 to mean that government now approves used-car importation and that the directive repealed EO 156.  Aric members also maintained that the Supreme Court only ruled on the legality of imposing a permanent injunction on the operations of Forerunner Multi-Resources Inc., the “master licensor” for used-car importation at the Cagayan ecozone.

Peter Geroue, president and chief executive officer of New Apollo International Cagayan Trading Inc., the biggest dealer of Japan-sourced vehicles here, offered this suggestion: “We ask the government to allow us to process [the documentation and registration] of the 700 [vehicles], to allow us to recover our investment and at the same time, [allow the BOC] to collect the import duties,” he said.

After that, the group could stop the used-car importation if the government says so, Geroue said. “That is the win-win solution,” he added.

The group of resort and restaurant owners here also expressed concern over the looming shutdown of the used-car industry in the free port. “Many of those who come to Sta. Ana to look for [imported secondhand] vehicles dine and stay overnight in our restaurants and inns, so our losses would be two-fold,” said Joan Taguba, president of Sta. Ana Hotel and Restaurant Resort Association.

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  • UrHONOR

    >>>STA. ANA, Cagayan—Buyers of imported second-hand cars and vans have begun canceling orders in what vehicle dealers said was the aftermath of the controversial Supreme Court ruling that banned the importation of used cars at the  Cagayan Special Economic Zone and Freeport (CSEZFP)<<<

    EXCELLENTE!  Mababawasan na ng bahagya ang mga TNL na PASIKATERO. BUROT, at MAPAGMALAKI sa kapaligiran.  Malaking tulong ito sa mga local car mftrs and assmblers na makakatulong din sa ating ekonomiya at pangkalahatang pag-unlad.  

    Once more, CRIME pays not.

  • http://profile.yahoo.com/NYKIOQEDTUD4FPPPVHP6XMFNEA Raul

    Ito ang sumisira sa ating industriya. Cars assembly industry is billion dollar tax revenue while this one is 300 million only.

  • mon key

    This is very good news! Thieves lose, the country wins!

  • http://pulse.yahoo.com/_E7SFPQFWHHEAJ4IZKPD7OYJXVM Jabba

    MGA BULOK NA PINAGLUMAAN SA IBANG BANSA? I’M BETTER OFF WITH MY TOYOTA, NISSAN, AND MITSUBISHI, GAWA PA NG MGA PINOY. YUNG MGA BULOK AT POLLUTING NYO NA SECOND HAND, GAWIN NA LANG TANSAN PARA MAY PAKINABANG.

  • kunsabagay

    this is another venue for smuggling now being stopped and its long overdue. GOOD JOB BOC 

  • boi skater

    It is more than likely that most of these used cars were
    smuggled in anyway so the government revenue generated from this business is
    miniscule in comparison. The lucrative part is the smuggling; everything else
    is just a front.

  • ben311

    kunyari lang yan…lalo na malaki ang pera involve…pinas pa !

  • 33Sambuang2

    tama lang at sa wakas nasugpo na rin ang number one smuggler sa bansa. boc good job tandang lolong, merese…………………..beh buti nga

  • http://pulse.yahoo.com/_W7TPARCYJFCSA3PBQAM3MVZO3E kurakut

    PWEDE NAMAN PALA ANG IMPORTED USED CARS! AT KUNG TOTOONG DIRT CHEAP ANG MGA ITO AY MABUTI PANG BILHIN NG GOVT. PARA GAMITIN NG OFFICIALS. START FROM MALACANYANG, SENATE, HOUSE OF REP, SC, DEPTS, GOVS, MAYORS ETC… BEGGARS CAN’T BE CHOOOOSSSY. 

  • http://profile.yahoo.com/NXV3F6YUQWDOA4HPYOFN5F2N3U Danyel

    Wait for Enrile’s resbak! 

  • William Dave

    sayang naman mga tsikot.. bigay nyu nalang sa amin yan.. puhleeezz!!

  • http://profile.yahoo.com/MJFXCRSCXRWPLL42QQKSINC3AQ Mamerto

    To have “SOLE” control and operation of this business is 
    the objective of “Mr.Big-Shot (of little or no morals).

    Probably thinks, he “could take all these with him”.

  • http://pulse.yahoo.com/_VNLEL6SV5GHRUCLB3WSZVOZCUA RockA

    Must make new car dealerships richer.  Dry up the used car market.  Maybe an Executive Order will be proclaimed making it illegal to sell your second hand vehicle to anyone but a new car dealership.  Filipinos are wealthy, they don’t need to be buying second hand cars.  
    /sarcasm off

  • http://inquirer.net unokritiko

    IF this BOC Biazon has balls and brains he should divulge the people who made an order of this second hand cars as their are part of smugglers i would say!
    First hand I just knew that you can made an order of second hand car before it arrives. and take note the This KKK Inutil LTO official is in connivance with it because the papers for LTO is already done prior to arrival. What a speedy transaction involving a  govt offices. Offices I mentioned because not only th LTO is involved but The LTFRB and BOC are involved in this one stop shop.
    This inutil govt should explain about this matter why it is tolerated!!!
    Pwe! Penoy na bugok pa.

  • ALDEA

    Meron lang malakas mag-lobby dito.. the last time i checked, we Filipinos are living on FREE ENTERPRISE SYSTEM… meaning, we can get involve in any legal business as long as we secure proper permits to operate and paying the necessary taxes, sa totoo lang we Filipinos don’t get tax holidays from our beloved government for starting SMBs and create small number of employment, not the likes of big car distributors in the country… Importing second hand quality used vehicles to the likes of Philippine economy will be very benificial to Filipino masses… aminin na natin, and put that hypocrites / politics aside.. considered as a third class country… more than 60% of our population working age group can’t afford to buy even one small second hand vehicles… ang dapat lang na ipag-bawal dyan ay ang pag-import ng used LUXURY VEHICLES of all types.. but to AUV’s, pick-ups, vans, light trucks, heavy trucks, or any industrial type vehicles huwag naman sana dahil iyan lang ang ma-aafford ng ibang maliit na kababayan natin who like to join and start SMBs of their own… ang mga lobbyist lang naman dyan eh ang mga foreign control corporation na nagdadala ng mga CBU sa bansa… bakit ilan bang planta ng sasakyan ang meron sa atin para sabihin nila na they creates thousand and thousands of employment opportunities eh completely build units naman ang dinadala nila kaya nga CBUs… and these big companies are blessed with TAX HOLIDAYS… hellooooo

  • http://profile.yahoo.com/UZMYIL5FXLVIHRZXBQGONZS6U4 Jhune

    Bakit hindi nalang gawing legal ang importasyon patungan ng tamang buwis at isaayos ang safety ng sasakyan, may compitisyion at maraming ma produce na trabaho at magkaroon naman ng progreso sa mga ibang lugar na hindi lang diyan sa kamaynilaan.. Ang gusto ng mga dealer ng brand new car sila lang ang may pinagkakakitaan.  

  • jimi_c

    I am living in the western world, once the car is sold and become a used car that means the car has mechanical problems, fuel inefficient and other issues. The insurance is very strict on road worthiness and the person listed in the insurance, is the only person allowed to drive the vehicle.  If you want other members of the family to drive the car, you inlist their names in the insurance policy and you will pay more insurance premium every month.  In most cases, 1 monthly insurance premium is equivalent to one year insurance policy in the philippines.  Sometimes we think used car is cheap but your maintenance cost is high and most of them are  burning more fuel causing air pollution.

  • http://profile.yahoo.com/SYG36KOOLRY47VA3ICPJJ5CQTQ ADD

    Brand new is still better for the economy and the environment as a whole. Not all second-hand vehicles are declared properly so they can pay less taxes. The importer, Customs, LTO and Enrile are the ones who get rich in this business.

    Second-hand cars tend to pollute the air more compared to the new ones, and tend to break in the middle of the road than new cars.

    Don’t settle for the garbage of other countries when we can build our own vehicles like what Francisco Motors and Columbian Motors were doing before.

    If the business in Port Enrile is bleak, the Philippine auto industry would prosper.

  • http://profile.yahoo.com/SYG36KOOLRY47VA3ICPJJ5CQTQ ADD

    Go for new Toyota and Nissan, they have assembly plants in Laguna. Help our auto industry by buying their vehicles.

  • axe musk

    These 2nd hand cars just underwent good grooming to make it appear as good ones…. But actually were due for dumping due to their conditions and will only bring hazards both t human and nature…Also, the businesses in the selling of these 2nd hand cars were just the ones making good income as they mix illegal goods into these business…. if not misdeclare their actual importations and thereby deceiving the gov’t. of its tax payments….

    THIS IS JUST A GOOD MOVE, BUT THE AUTHORITIES SHOULD CONTINUOUSLY MONITOR THE AREA CONSIDERING THAT THIS IS UNDER THE CONTROL OF SEN. JUAN PONCE ENRILE AND NOW HIS SON LIKEWISE WANTED MORE POWER TO CONTROL THE GOV’T. AND CONTINUE THEIR ILLEGAL ACTIVITIES IN THEIR PROVINCE…

  • mynnyx

    Mr. Vicente ala naman mangyayari sa mga second hand na car na yan………kasi dalawang taon lang sira na…………maganda pa magiba ka na lang ng negosyo…………..kasi tambakan na tayo ng second hand car…………………kawawa lalo ang mga pinoy…….gusto mo lang kumita ng pera eh sa maayos na paraan na………….lahat ng mga bulok na kotse na yan itapon nyo na lang sa dagat at gawin bahay ng mga isda maganda pa…………………

  • fernan107

    dapat itigil na talaga ang importation ng mga second hand cars dahil bukod sa nagiging imbakan tayo ng mga basura ng ibang bansa dahil itong mga second hand cars na ito di na pwede gamitin sa bansa nila dito naman sa pnas pinagkakakitaan pa ng mga gonggong na manloloko sa kapwa pilipino nila walang inisip kungdi magkapera sila hindi man lang isaalangalang kapakanan ng makabili dahil recondition lang ang mga makina ng mga ito at madaling masira ang mga ito….baka ka naman pwede ng ipatigil ni enrile ang opertion ng importation ng second hand cars….ka indo naman oooo

  • julymorning

    KAWAWA NAMAN ANG MGA MAYAYABANG AT MAG MAGNANAKAW NA MGA PULITIKO AT MGA PULIS PATOLA NA MAWAWALAN NG MGA IBABANDERANG MGA MAGAGARA NGUNIT MGA BULOK MAKINA NA MGA SASAKYAN. DI NA MAGIGING SIKAT SA MATA NG PUBLIKO ANG MGA MANDARAMBONG NA MGA UGOK NA MGA PULITIKO AT MGA PULPOL NA MGA PULIS PAG TINIGIL ANG NEGOSYONG ITO. MAAWA KAYO SA KANILA, AKALA NYO HINDI MAHIRAP ANG GAWAIN NILA? HIRAP KAYA MAGNAKAW SA MGA PROYEKTO AT MANLOKO O MAG HOLD UP.

  • http://pulse.yahoo.com/_HPGUIIJ44DMCSONOPI4JAEMUZM lex

    itiigil na yan! pera pera lang naman yan!malakas lumaklak ng gasolina ang mga yan! ang hirap magtipd ng gasolina para lustayin lang ng mga mayayaman. pwe

  • ProudToBePinoy75

    Just ignore the investors. It is their fault. Sell the cars and give the proceeds to the national government

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