A motor industry watchdog says used car dealers are swapping new parts for old ones once the vehicles they are importing have passed safety checks in New Zealand.
The Motor Vehicle Disputes Tribunal has found three such cases in the past year.
In his annual report Chris Cornwell, the tribunal's Auckland adjudicator, says the three cases may be the tip of the iceberg and urges the Government to close the loophole.
Mr Cornwell wants traders to have to provide the agent who checks the vehicle with an invoice for the new part and hand over old parts for retention or destruction.
Clive Matthew-Wilson, editor of car review website Dog and Lemon, says swapping parts has been going on since warrants were introduced in the 1930s.
"A lot of dealers are very squeezed and they'll take any steps they can to make a little bit extra on a car as it comes in. If this practice continues and isn't closely monitored, then it's going to cause a really serious accident I would imagine."
Automobile Association spokesperson Mark Stockdale says there is a loophole, but it is not one dealers are likely to exploit, because it does not make economic sense.
"Taking out the old part, putting in a new part which will pass the test and then taking it out again and putting the old part back - that's a heck of a lot of labour for really what might amount to a few hundred dollars in savings to the vehicle dealer.
"Really, it's easier for them just to reflect the cost of those new parts in the sale price of the vehicle."
Mr Stockdale says dealers found swapping parts should be removed from the industry.