Disaster survivors getting gouged in search for replacement vehicles
11 May 2011 | By admin in Current News | No Comments YetThe destruction of hundreds of thousands of vehicles in the March 11 tsunami has brought a cruel arithmetic of supply and demand to the disaster area, as some used car dealers are gouging buyers.
There are even reports of so-called “disaster survivor prices,” while empty lots in tsunami-ravaged areas like Rikuzentakata, Iwate Prefecture, are filling with rows of used cars on offer by absentee sellers. The situation is being further exacerbated by a decline in the number of used cars on the market from before the disaster, triggered by a government program to promote low-emission vehicles.
The family of one 47-year-old woman in Rikuzentakata lost all three of its vehicles to the tsunami. Her 21-year-old son bought a car soon after to get to work, but the family has yet to replace their light truck, essential for restarting their tatami business. There is a 2004 model light truck with some 50,000 kilometers on the odometer on offer at a recently reopened dealership — for 700,000 yen plus, or more than an entry level Suzuki light truck costs new.
“We can’t get back on our feet without a truck,” the woman laments.
According to the local representative of a major car dealership company, the firm now has about 70 percent fewer used vehicles on its lots compared to before the disaster, and prices of used light trucks have risen by 150,000 to 200,000 yen. A former parts shop employee told the Mainichi that “rust-covered cars that would have gone for about 80,000 yen before the tsunami are selling for 200,000 yen!”
Meanwhile, as a dearth of used cars persists at dealerships and prices rise, ad hoc used car lots are beginning to pop up across the city. Nothing marks them as businesses except the surnames and mobile phone numbers of the sellers taped to the cars’ windows. When the Mainichi called one of the numbers, the person on the other end said simply, “I’m not interested in talking to reporters,” and hung up.
“I don’t know any of them,” said 53-year-old Toshiaki Hasegawa, who has been in the car business in Rikuzentakata for some 30 years. “Can they guarantee the vehicles after a sale without being here? Do they even have used car dealer permits?” he continued, shaking his head.
Tsunami survivors from the coast, unable to buy vehicles close to home, have also begun going further inland to look for cars. Discount used car dealer Auto Basho International in Ichinoseki, Iwate Prefecture — about 30 kilometers from Rikuzentakata — says it’s had as many as 15 customers from the coast per day, most looking for light vehicles up to 200,000 yen. However, even joining automotive auctions in Tokyo, the dealership has only been able to purchase about three vehicles at that price per day, apparently due to a nation-wide shortage.
The Japan Used Car Dealers Association, with about 10,000 member dealerships nationwide, told the Mainichi that it has received numerous complaints from disaster survivors claiming they’re being gouged. “It would appear that these cases aren’t just from rises in market prices, but that there are some malicious dealers out there,” the association stated.
According to the association, a combination of people holding off on replacing cars after the 2008 Lehman Shock and increasing numbers of older cars scrapped when the government was offering subsidies for low-emissions vehicles has led to the number of used vehicles on the market dropping from some 8.87 million in 2008 to 6.53 million in 2010. The association also said that, with the March 11 quake and tsunami cutting into vehicle production and limiting supplies of new cars, there is little prospect for growth in the number of used cars coming onto the market via trade-in.
Article source: http://mdn.mainichi.jp/mdnnews/news/20110511p2a00m0na013000c.html

