By Vincent | 18 September 2023 | 0 Comments

How to Import Cars from China: A Guide for International Car Traders

For all the international car traders looking to import vehicles from China, there are several key things you need to know. China has become a major player in the global automotive industry, and tapping into this market can be a game-changer for your business.

Primary Export Channels

Currently, there are two main channels for exporting cars from China. The first is the conventional export channel, primarily controlled by the major automobile manufacturers. The second is the parallel export channel, which involves exporting new cars under the guise of used vehicles. This parallel channel accounts for approximately 2% of the total new car exports from China.

With the rise of new energy vehicles in China in recent years, various brands have expanded their presence in international markets. This has opened up new opportunities for exporting Chinese cars to the world.

The mainstream channel primarily revolves around the major automakers and their direct factories. These manufacturers have the advantage of flexibility and adaptability in responding to market demands. They can adjust their production lines to produce models suitable for export and ensure compliance with the certification requirements of target markets. In this article, we will delve into the second export channel, which involves exporting new cars under the guise of used vehicles.

Four Key Players in the Car Export Process

In the entire car export process, there are four main players: car suppliers, registration companies, qualification companies, and logistics companies.

Logistics Companies: These companies play a crucial role in transporting and transferring cars during the export process. They provide comprehensive transportation services for both domestic and international routes, including road transport, car carriers, railway transport, and sea transport. For international traders, finding a reliable logistics company that offers multiple transportation options is essential.

Qualification Companies: Exporting cars from China is a regulated industry, and only enterprises with specific qualifications recognized by the Chinese Ministry of Commerce can engage in this business. Therefore, finding a trustworthy qualification company is crucial for exporting Chinese cars. The management of qualification companies by the Chinese Ministry of Commerce is dynamic, meaning that if a qualification company's performance is subpar or fails to meet export targets, its export qualification may be revoked. Companies with industry expertise and experience can also apply to the Ministry of Commerce for permission to export cars.

Registration Companies: Before cars can be exported, they need to go through a registration and transfer process, becoming used cars. This step is managed by registration companies.

Car Suppliers: Car suppliers refer to enterprises with the qualifications to sell cars. This includes all types of dealerships, such as 4S stores, scattered across China, which serve as sources for exporting cars.

All four of these players are indispensable in the car export process, and each one plays a vital role. These roles can be fulfilled by separate companies, a single company, or a combination of companies, making the business a complex web of collaboration.

Key Concerns for Foreign Importers

When it comes to importing cars from China, foreign traders have several key concerns:

1. Price: Naturally, price is a top concern for importers. Everyone seeks the most competitive prices from their suppliers. However, prices can vary due to various factors such as exchange rates, manufacturer policies, marketing strategies of local dealerships, and transportation costs. Experienced importers often collaborate with multiple suppliers to find the best partner that meets their needs and offers competitive pricing.

2. Payment Terms: Some customers prefer to see videos of the cars before making payments, which is a reasonable request. However, it may not always be feasible, especially if the car is not readily available for viewing. It's essential for importers and suppliers to establish trust and understanding regarding payment terms and vehicle inspections. Deposits can be a way to secure a vehicle before conducting an inspection.

3. Delivery Time: As outlined in the car export process, delivery time is influenced by various factors such as the car's availability, location, chosen transportation method, and destination. Weather conditions and government efficiency also play a role. Importers can mitigate risks by choosing reliable suppliers and trusting the information provided by them.

4. Service: Service quality can be just as crucial as price and payment terms. In an industry that is relatively traditional in China, many practitioners lack experience in international trade. This can lead to issues when dealing with customer requests for last-minute changes, misunderstandings, or mistakes in vehicle specifications. Establishing long-term relationships with reliable suppliers who provide accurate information and support can greatly reduce risks and streamline the import process.

Remember, in the world of international trade, good service is a rarity. Choosing trustworthy partners is often more critical than seeking the lowest price. Wise businesspeople prioritize partner selection over pricing.

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