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Importers continue to fight restrictions

Used car imports suspended amid warnings of further border blockades

The ongoing dispute over regulations governing used vehicle imports from the United States has resulted in the temporary suspension of import and export operations at eight Mexico-U.S. border crossings.

The root of the issue is that the government wants to impose restrictions on those imports and although the number of imported used cars heading into Mexico is being reduced, it remains a serious problem south of the border.

The used vehicle associations in Mexico have blocked the international ports of entry three times along the northern border in an effort to force the government to change the new, stricter import regulations. The used car importers’ strategy is to pressure the federal government to ease the restrictions on imports and make changes to the legislation.

The government says what’s really important is to ensure the entrance of roadworthy, legal vehicles into Mexico.

According to statistics from January to November 2014, the import of used vehicles reached 433,309, about 24% or 134,977 fewer imports than in 2013.

Part of the problem is that when an imported used car comes into Mexico it is not fully registered until it reaches its destination. The sicarios, or bad guys, take advantage of the unregistered cars to carry out illegal (and untraceable) activities. Another problem is the environmental impact of a lot of junk cars.

The government wants to ensure the cars meet environmental emissions and safety standards.

The push-back from the used car lobby, led by the Federation of Used Automobile Sellers in the Borderland (FACAF), is ongoing and determined. They want to overturn the agreements by the highest Mexican courts, which have confirmed that the new restrictions are constitutional.

But the use of “amparos” — a temporary protection or injunction against the enforcement of the law until a court rules one way or the other — is widespread.

In recent years more than 90% of imports have arrived by means of amparos, opening the door to unregulated imports that leave a bold environmental footprint and contribute to insecurity through their use in criminal activities.

Eduardo Solis Sánchez, president of the Mexican Automotive Industry Association (AMIA), applauds the recent restrictions because the limits help reduce the impact of a lot of junk vehicles on the roads.

The Mexican Automotive Dealers Association (AMDA) strongly agrees. Unregulated imports have led Mexico into a crisis and it’s not over yet, it says. Imported used cars represent 43% of the total of new car sales in Mexico.

In 2006 used vehicle imports jumped from 338,064 to 1,282,990 units. In 2007 the number dropped to 870,785 and since then fewer cars have been brought in due to more rigorous enforcement of the regulations.

Those regulations limit imports to roadworthy vehicles that are between eight and nine years old, and require payment of a 10% import tax and 16% IVA. The vehicles must have a certificate of origin, a valid emissions certificate, be in good mechanical and physical shape and cannot have been declared salvage or stolen in the U.S.

The used car importers strongly disagree. They want to be able to import vehicles as they have always done, and they say they need a fair valuation of each vehicle. The prices set by the government, they contend, are too high. The importers propose using the bill of sale as a baseline for determining the price and calculating the required taxes.

They warn they will continue to mount blockades of the border until the government issues a more favorable resolution.

Meanwhile imports have been suspended in Tijuana, Mexicali, San Juan Río Colorado, Tecate, Juárez, Reynosa, Matamoros and Laredo.

Mexico News Daily

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