Rumour: Car Sales Outlets Monopolizing Importing?

[gunat]

Heard a rumour (and thats what it is for now) that the Car Importers association (ie. Unreg Used cars importers) has signed a petition to submit to our Prez.

The petition (apparently) is to put a stop to personal imports by individuals.

Given the current advantage where private individuals can save quite a lot of money if they import a car themselves, it has become the more economical path to getting a used unregistered car.

I wouldn't put it past the local Car Sales folks to try monopolize that market as they are probably losing 200-400k per car to personal imports.

Anyone heard differently?

[Sylvi]

Heard a rumour (and thats what it is for now) that the Car Importers association (ie. Unreg Used cars importers) has signed a petition to submit to our Prez.

The petition (apparently) is to put a stop to personal imports by individuals.

Given the current advantage where private individuals can save quite a lot of money if they import a car themselves, it has become the more economical path to getting a used unregistered car.

I wouldn't put it past the local Car Sales folks to try monopolize that market as they are probably losing 200-400k per car to personal imports.

Anyone heard differently?

'gunat',

I received this information few days back I did not want to start a thread.You are correct for the information Importers association will represent the matter to government to put single importers to tax net and investigate them. As single car importer will have less cost they do not have overheads like established importer. Leading importers give a three to six months guarantee on their Vehicles what they deal with. Single importer will sell little below the selling cost of established importer and change the address of what they advertise the vehicle next time to a new address there by they will carry on the sales regularly which is happening now.One more thing they bid more in Japanese auctions thereby Japanese exporters get the better profit. Regular established importers are complied to pay more same as single importers.

Vehicle Import is a big profitable business big time importers who import more than 300 vehicles for a month say single importers heave come up like mushroom today after duty reduction.Established big time importers say because of their hard work for number of years with all difficulties during lean period drawing from their reserves during that time of high tax have sold only few vehicles and every cent what they make is taxed by the government.Single or two vehicles importer can evade tax in so many ways.

I hope members will get a clear picture of the present vehicle imports.

Sylvi Wijesinghe.

Edited February 15, 2011 by Sylvi

[jdnet]

Single or two vehicles importer can evade tax in so many ways.

example?

[DevakaC]

example?

He might be referring to tax on income. Profit made on personal imports are taxable. Taxable only if they are declared.

[The Stig]

Utter Bull****

If single imports are going to be banned how will the honorary ministers get their luxury prados and mercs down ?

Do you think they'll be willing to pay to a third party importer ?

That petition wont even go past the office clerk

[rangerover]

I don't see how such selfish petitions could suceed. Obviously this lot has forgotten their humble beginings.

[nexus]

if this really happens it will be horrible for most car buyers.

[The Don]

Fact is, the mark up on current un regi vehicles by established importers are quite high.

The fact also is that tax has nothing to do with this as all parties involved are also involved in tax evasion in one form or the other. It is a chronic problem in Sri Lanka and not limited to personal importers.

A lot of so called established importers started life as personal importers.

The government should not be dictating business models in an open market economy (though I know it isn't really in Sri Lanka), if anything the government should protect its citizens from extortion. If they are struggling to compete they should evolve their business model, and concentrate on cutting overheads, offering warranties and service packages, something that sets them apart from the so called personal importers.

I mean how else can they justify charging 400K margin on top of the actual cost of import on a single vehicle ? And these so called overheads are their own business decisions. Nobody forced them to open massive showrooms etc or import 300 vehicles at a time !

[VVTi]

How can anyone stop an individual from importing a car? That's absurd!!!

[Sylvi]

Members,

I too was a Importer of Motor Vehicles during CRA time from Uk then Later I shifted to Japan and I was in and out of Japan in late 1970 till 1988.

then at that time there were very few importers only existing one of the oldest importer is I****A now diversified to Financing and real estate. Most old timers have gone off from the arena.What ever others say there are few Importers who came in 1980 decade to import of vehicles after open era are holding on to import trade and because of them the Vehicle dealing prices are very high they keep about .3M or more for small vehicle 1M or more on high end luxury vehicles. If not for them small time importers of one or two vehicles cannot exist.I personally know leading importers carry more than 1000 Vehicles in stock if you account for their profits after paying bank interest at the end of the year are very little.I am not advocating the big time dealers. Single vehicle importer have negligible overheads he sells .1M or.2M less than the big time importer and forget about same.Because of big timers Single vehicle importer is able to stand on their feet.

We in Srilanka any one can import a vehicle if they have a temporary VAT registration this is miss used by some importers opening LETTER OF CREDIT by number of people who are their friends and relatives.I know importer established L/C more than 200 vehicles few years back to the name of a very old person who is no more in this paradise island sold all those vehicles when tax department followed the person he was not in that address.I do not agree with one comment that no one requested the big timers to open up very big show rooms and carry large stocks.

YOU CAN'T DO BUSINESS FROM AN EMPTY WAGON.

Sylvi Wijesinghe.

[Sylvi]

How can anyone stop an individual from importing a car? That's absurd!!!

'VVTi,

I agree to your comment if you have correct documents and funds in your bank any one in this country can import a Vehicle. To prevent the miss use of this facility the government like permit vehicles has to change vehicle import laws of our country for a single person.

Sylvi Wijesinghe.

[The Don]

Members,

I too was a Importer of Motor Vehicles during CRA time from Uk then Later I shifted to Japan and I was in and out of Japan in late 1970 till 1988.

then at that time there were very few importers only existing one of the oldest importer is I****A now diversified to Financing and real estate. Most old timers have gone off from the arena.What ever others say there are few Importers who came in 1980 decade to import of vehicles after open era are holding on to import trade and because of them the Vehicle dealing prices are very high they keep about .3M or more for small vehicle 1M or more on high end luxury vehicles. If not for them small time importers of one or two vehicles cannot exist.I personally know leading importers carry more than 1000 Vehicles in stock if you account for their profits after paying bank interest at the end of the year are very little.I am not advocating the big time dealers. Single vehicle importer have negligible overheads he sells .1M or.2M less than the big time importer and forget about same.Because of big timers Single vehicle importer is able to stand on their feet.

We in Srilanka any one can import a vehicle if they have a temporary VAT registration this is miss used by some importers opening LETTER OF CREDIT by number of people who are their friends and relatives.I know importer established L/C more than 200 vehicles few years back to the name of a very old person who is no more in this paradise island sold all those vehicles when tax department followed the person he was not in that address.I do not agree with one comment that no one requested the big timers to open up very big show rooms and carry large stocks.

YOU CAN'T DO BUSINESS FROM AN EMPTY WAGON.

Sylvi Wijesinghe.

Sylvi, if the current business model of an organisation is not sustainable, it's up to them to adapt and change with the market. Personally I do think beyond consumer protection, the government should not be dictating business practices to private enterprise.

If the VAT system is being abused that is a different issue to resolve. But that has no bearing on the importation of vehicles. You and I both know our paradise island has a serious problem of tax evasion.

[VVTi]

'VVTi,

I agree to your comment if you have correct documents and funds in your bank any one in this country can import a Vehicle. To prevent the miss use of this facility the government like permit vehicles has to change vehicle import laws of our country for a single person.

Sylvi Wijesinghe.

GOSL cannot control every aspect of business to suit their own lackeys and hangers ons.

If I want to import a car, if I have the money and eh contacts then I MUST BE ALLOWED to do so, without having to back off due to pressure from some retard Car Mudalali.

Where will it end?

What next?

If the Car Importers are feeling the heat, then its high time they rethink their selling strategy, don't you think????

Its a free market economy... people are free to import or trade in anything as long as the GOSL dues are paid.

[isurujosh]

i really feel sorry for these big fishes . what a spledid service they (eg: the kohuwala big fishes) provide to the public at such a reasonable price.

[vishkid]

This is part of the 'long tail' - we live in the information age and the choice is immense.

People will hv to change their operating models, rather than attempting to create barriers to entry.

But I see no harm in IRD investigating and catching the tax-dodgers among those temporary VAT permit holders.

I would even give them a tip to start the search within their premises

[Sylvi]

Sylvi, if the current business model of an organisation is not sustainable, it's up to them to adapt and change with the market. Personally I do think beyond consumer protection, the government should not be dictating business practices to private enterprise.

If the VAT system is being abused that is a different issue to resolve. But that has no bearing on the importation of vehicles. You and I both know our paradise island has a serious problem of tax evasion.

Don',

Yes I agree to your reply.

Almost all big time importers and few sales show room holders (They only sell imports by others for a commission) find an noticeable drop of sales after single importers have come up to the market. As all of us know due to heavy margins big time importers have. This is the reason even topic starter wanted the correct information and comments from the forum members.

Some IRD Bank and Government officers also import vehicles on others names there by in our paradise island has become a heaven for tax evade responsibility.

Sylvi Wijesinghe.

[Sylvi]

This is part of the 'long tail' - we live in the information age and the choice is immense.

People will hv to change their operating models, rather than attempting to create barriers to entry.

But I see no harm in IRD investigating and catching the tax-dodgers among those temporary VAT permit holders.

I would even give them a tip to start the search within their premises

'vishkid,

Your post is very appropriate about long_tail I do not think any big time dealer will understand the value of same.

By the time IRD try to trace Tax dodgers they will not be in this country there are few examples in the recent past.

Sylvi Wijesinghe.