www.autofile.co.nz
MARCH 2026
THE TRUSTED VOICE OF NZ’s AUTOMOTIVE INDUSTRY SINCE 1984
Damage flag surge ‘clogs’ supply chain
Industry warns of ‘false positives’ but agency claims shift reflects proper monitoring of compliance issues
T
he number of used imports attracting damage flags when inspected at the border has more than doubled in the past year, despite the volume of cars coming into the country decreasing. Figures from the NZTA show more than 6,500 such flags were issued for the 78,000-plus imports in 2025, which was up from 2,921 out of 95,652 units in the year prior. The number of damage flags as of December 18, 2025, also exceeded the 6,095 recorded in 2021, when there were nearly 141,000 used imports, according to figures released to Autofile under the Official Information Act. The spike in such action has prompted concern at the Imported Motor Vehicle Industry Association (VIA), which says the latest total includes false positives and risks costing businesses hundreds of thousands of dollars. Chief executive Greig Epps says VIA is in discussions with
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More than 6,500 border damage flags were issued for used imports in 2025
government officials about how the NZTA’s damage-flag settings are being applied to used imports at the border. “In practice, an ‘if in doubt, flag it’ approach is producing a high volume of false positives and pushing costs and delays downstream – often without any discernible improvement in safety outcomes,” he told Autofile. “Border flags are meant to be an early-warning mechanism, identifying vehicles that may have structural damage or otherwise
require closer scrutiny at entry certification. “When the system over-flags, it becomes a blunt instrument and taxes compliant vehicles, clogs processes and erodes confidence.” Epps notes damage flags can trigger commercial consequences for importers, such as price renegotiations, cancelled purchases and issues with consumer perceptions, even if later inspections confirm no major structural problems. Only qualified inspectors at
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