A vehicle is driven through a ‘de-con’ cleaning machine during the importation process.

Richard Edwards explains how used import vehicles are picked for NZBy Richard Edwards

The process of selecting a used vehicle overseas, shipping it to New Zealand, then having it sit in a car yard before being driven off the lot by the new buyer isn’t as simple as it may seem.

While the used-import supply chain has hit the headlines in recent weeks over the potential for damaged vehicles to slip through the net and arrive here, New Zealand’s system is one of the most comprehensive used-import vehicle compliance programmes in the world, claims the industry.

The processing volume is huge – 38,779 passenger cars in the first six months of 2013 – with used import figures back to pre-recession figures.

Driven has focussed on the Japan-New Zealand trade, but the process is similar for other source markets, such as Britain, Singapore and North America.

The process of getting the right vehicles on the road in New Zealand starts at the point of buying. Rather than heading to Japan as in the past, virtually all traders use an agent or wholesaler, who will assess vehicles for them before auction.

In an auction that may see more than 10,000 vehicles in a day go under the hammer, the trader or agent will check out a list of pre-researched vehicles.

They are assessing condition and basic mechanical operation. The angle is normally on what it will cost to prepare the vehicle for market – will it need paint or panel touch-ups, or other refurbishments, and what will this cost? Some items may appear minor, but can lead to significant issues down the line for compliance. These include dented sills and corrosion – surface corrosion can lead to significant cost down the line should the car need certification of any repairs.

The fact that it is expensive to have damaged vehicles certified is a disincentive to importing such cars.

Once their selection is made, the trader, his agent or wholesaler will purchase the vehicle, and in most cases it will enter the logistics chain.

Border inspection
The official process of a vehicle being imported here begins for most vehicles in Japan. The vehicle will be transported to a Ministry of Primary Industry-approved yard, where it may be pre-cleaned and inspected, before being passed through MPI bio-security and NZ Transport Agency structural inspections.

Experienced inspectors crawl over, in and around vehicles, looking for seeds, animal and leaf matter – if any is found, the vehicle will require cleaning or treatment.

This is usually an extensive wash with a blaster, or in some cases a special “de-con” machine – an automated multi-jet washer used by the largest inspection firm JEVIC.

Inspectors also look for structural damage to the vehicle, sign of repairs, corrosion or other such issues. Should significant damage be found the vehicle will be “flagged” as “imported as damaged” on its file.

This is considered an important part of the process, as it provides a “two-stage” system of assessing any damage to all vehicles. The level of damage required for a flag to be added is very low – including damage many NZ buyers would consider simply cosmetic.

Until 2011 such inspections were handled by MPI, or companies working on their behalf. Now, the checks are handled by professional inspection agencies offshore – including Jevic and AutoTerminal Japan – and Independent verification services onshore in New Zealand.

Often traders will use a single logistics company or a logistics package from their shipping company, which will handle the arrangement of inspections, processing of paperwork and shipping the vehicle.

Vehicles entering the New Zealand market are processed on a “standards basis” first. They are required to meet international emissions and frontal impact requirements in most cases, rather than being tested or judged in an individual basis.

Compliance process
Once on the ground in New Zealand, and provided they have had their border inspection process completed, they can head to a compliance facility to be complied, or to a workshop to receive repairs. The idea behind the damage flag is that the vehicle cannot be imported significantly damaged, and have this hidden before the compliance process.

Most compliance facilities are independent businesses, and are responsible for the stripping, reassembling and minor repairs and the replacement of service items on vehicles. The facilities are NZTA-approved to a significant standard, down to the type of lighting used when vehicles are inspected.

The inspection itself is not carried out by the compliance facility, but by one of the three Transport Service Delivery Agents – Vehicle Inspection New Zealand, the Automobile Association and Vehicle Testing New Zealand. They have NZTA-approved and monitored inspectors on each site, checking each individual vehicle, issuing and attaching a Vehicle Identification Number and provided it passes, issuing the paperwork required to register the vehicle – an MR2A.

This inspection is intensive, and invasive, including the removal of interior trim and inner guards to seek out any damage or corrosion that may have been missed in earlier inspections. Should there be significant damage that has been repaired, in many cases a “Repair Certification” will be required. The repair will be inspected by an independent certified person, who will establish that it has no influence on structural integrity.

Once vehicles are certified and hold an MR2A they can be released to the trader, to be sold and registered for the road.

Damage flags
Recent concerns centred around there being more vehicles marked as having been inspected for damage here than picked up in the border inspection in Japan.

The head of the Imported Motor Vehicle Industry Association, David Vinsen, said this is largely down to how invasive and successful the compliance process is.

“That is an indication of the robustness and rigour of the Transport Service Delivery Agent compliance system. They are getting the vehicle up on a hoist, with good lighting, and making invasive inspections.”

He says while the border inspections are good, they are not designed as to be so invasive.

Damage flags can be removed, but only by the NZ Transport Agency, which will remove them in the case of minor repairs.

Extract from the NZ Herald


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