page_title: Automotive industry in New Zealand
section_title: Government action
hierarchical_section_title: Automotive industry in New Zealand / Government action
caption_attribution_description: English: Photograph of Joseph Gordon Coates in 1931.
context_page_description: The automotive industry in New Zealand supplies a market which has always had one of the world's highest car ownership ratios. The distributors of new cars are essentially the former owners of the assembly businesses. At the dealership level they have maintained their old retail chains in spite of the establishment of the many new independent businesses built since the 1980s by specialists in used imports from Japan. Toyota entered into direct competition with those used-import businesses refurbishing old Toyotas from Japan and selling them through their own dealers as a special line. The nation's car fleet is accordingly somewhat older than in most developed countries.
  New Zealand no longer assembles passenger cars. Assembly plants closed after tariff protection was removed and distributors found it cheaper to import cars fully assembled. Cars had been assembled at a rate nearing 100,000 a year in 1983 but with the country's economic difficulties their numbers dropped sharply. Towards the end of the decade the removal of various restrictions as part of the nation's restructuring of its economy made available low-priced old used cars from Japan.
context_section_description: A factor identified as economic nationalism. In 1927 when 80 per cent of cars were imported from North America the method of calculating duty was adjusted in the hope of encouraging imports of the smaller British cars and more importantly encouraging more enterprises into local assembly.  At the height of the depression the government announced its determination to ensure as much as possible work should be done by New Zealand labour.
  In August 1934 Minister of Finance Gordon Coates announced that as the present tariff concessions had not been sufficient to encourage foreign manufacturers to assemble their cars in New Zealand the new duties to take effect from 1 January 1935 would be:
  Complete vehicles: British 15 per cent, others 60 percent
  Unassembled vehicles: British 5 percent, others 50 percent
  A definition of completely knocked down (CKD) would be fixed by the minister and modified to ensure an increasing use of locally sourced materials.
  The motor vehicle trade's response was that they considered the reduction in tariff for ckd imports would not pay for the cost of local assembly
caption: Gordon Coates
  minister of finance
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