In follow up to our previous blog post, we can confirm used car imports to Russia will have an increase in import duty.
As it was expected, Vladimir Putin has signed the governmental regulation on the increase of import duty on used cars to Russia. The regulation comes into effect in one month since the day of its official promulgation. It is informed that this duty is constituted for the period of 9 months concerning import of automotive engineering, trucks and automobiles.
Import duty on used cars aged from 1 to 5 years rises from 25 to 30 %.
For those who have been importing, you might notice it says 5 not 7 years. Here more on that:
The most disputable question is reduction of maximal import age of cars from 7 to 5. Cars over 5 years will be imposed from 2.5 to 5.8 Euro per 1 ccm import duty. Taking into consideration governmental measures taken on prohibition of car bodies with following parts it is evident that automobile market of Primorye will have hard times soon.
On the positive side, it looks unlikely that RHD (ie Japanese) vehicles will be banned. It is being discussed, but most authorities agree that to ban them would cause to much havoc in the Far East regions of Russia:
…the State Duma authorities discuss the question on imposition of technical regulations on prohibition of right-hand drive cars. But according to the talks of the governor of Primorsky region Sergey Darkin and Secretary of Industry and Trade of Russian Federation Viktor Hrystenko, it is unlikely to happen.
Have you heard of the that little name before? Of course, it seems as if everybody knows about the GT-R (of the Skyline heritage). In fact, it seems to be the embodiment of Japanese sports cars in almost every aspect. This huge name is in popular demand in many parts of the world and you might be interested to know that it easy to get (although expensive) on the used car market.
Yep, that’s right. You can pop over to your favorite exporter/auction agent and find a number of “used” 2008 (and soon 2009) GT-Rs. We call them “used” because they’ve been purchased once by the person putting it on market, not because they’ve been driven a significant distance. One such example is a car on JCarBuys: a 2008 Nissan GT-R Black Edition with Bose sound system. Here’s some details:
Equipment: automatic air conditioning (climate control), anti-lock brakes, alloy wheels, power steering, power windows, spoiler, supplemental restraint system (air bags), cd player, television, navigation, central locking, electronic fuel injection, electric seats, leather seats, power mirrors, stereo, tiptronic, 3-seat
Vehicle notes: BRAND NEW CAR, FACTORY BOSE SOUND SYSTEM, REAR/REVERSE MONITOR, Black Edition.
While imports (particularly used car trading) seems to be stagnating in most parts of the world because of economic turn down, there are still many nations still empty of affordable cars. Romania is one such place. According to Financiarul.ro:
In the first ten months this year, the number of used cars from import rose 105%, to more than 205,000 units…
As you can see, the eastern European nation is starving for affordable vehicles and while brand-new models remains prohibitively high, used car imports are filling all the holes in the social landscape. While nearly all of these cars are coming from Western Europe, there may be room for Japanese exporters to find sales direct or indirectly from this situation. While it may not be affordable to export cars to Romania (worth finding out for those looking to expand), we can expect the need of replacement cars in those nations that are selling to Romania. Maybe we’ll see increased imports for Ireland/UK/Netherlands as a knock-on effect.
I would like to continue with our series of vehicles you can find at Japanese auto auctions. But I going to take a small detour from the regular cars and get into something bigger (literally). Excavators and other industrial equipment are often sold in Japanese auctions for a number of reasons. Just like private car owners, industrial vehicle owners need/want to change their vehicles according to demands the business has at the time.
Since it is no easy thing to sell such equipment alone, you will find several auto auctions selling industrial equipment on the side. In addition to the general vehicle auctions, there are also specialized auctions that focus just on industrial and construction equipment. Often these auctions use the parade auction format (cars are “paraded” in front of buyers and auctioned individually) due to the size of the vehicles and the money involved.
The quality of these vehicles can vary, but you will see many that are in great condition (for their use). Those who are serious about buying used large equipment should really consider buying from Japan. Many importers (from Canada to East African nations to South-East Asian to South American countries) purchase from Japanese auctions because even after shipping costs and other fees involved, you will find better quality for a cheaper compared to purchasing from a local market.
To give an example, here is a 2001 Kobelco excavator currently available for export on JCarBuys Stock:
In continuation of our series, the Toyota Regius is a van made in Japan that is often exported throughout the world. There are many different sub-models that you’ll be able to find. That means you can find passenger versions, cargo models, a combo passenger/cargo type. Also they can be extended in length and height, they can be Deluxe versions, or stripped versions (useful for business purposes). You can also find many of them have duel sliding doors. There many choices to choose from (something you’ll see typical in Japan), and if the Regius styling isn’t your taste, there also many other van and people/cargo movers that are available in Japan.
When you are looking for quality used vans and cargo/people movers, Japan offers many vehicles of various sizes, uses, and designs. Japanese used car exporters are often more than willing to help you purchase such vehicles.
I would like to suggest a new tool I’ve found for those interested in search images that are tagged with foreign words (ie: Japanese) without having to know what to type.
To explain, ForiSearch takes one language input and translates it into a second language, then it searches Google, Yahoo!, or MSN images searches for images with such text.
LANGUAGE #1 > translates to LANGUAGE #2 > search GOOGLE, YAHOO!, OR MSN for related images.
It is very simple and useful for Japanese used car exporters and importers to use. There are many applications to use it with. For example, an Importer can search for a particular word and get 1. the word in Japanese, and 2. images to confirm the translation is correct.
To show: I typed in “rust” with Japanese selected as which language I wanted to search in. I got さび (if you see question marks, don’t worry, they mean rust). And to make sure my translation is right, I see a number of images with metal having rust forming.
Don’t worry if some of the images aren’t exactly what you are looking for. Sometimes that is because in the other language, the word has more than one meaning. Just as long as you get a majority of the photos of what you are looking for, you should have the right translation.
Once again, the Russian government is considering sharply raising Import Duty on used cars to stem the tide of second-hand vehicles entering Russia. Consistently for the past few years Russia has been the top Japanese used car importer, where even last year alone they imported 441,539 used cars and this year looks set to clearly surpass that amount by the end of this year. Being that they import more than four times the amount of automobiles than the next biggest Japanese used car importing country, having Russia exports restricted can hurt this export industry.
The cause of them thinking about raising duties no doubt has multiple factors. For one, Russia has a long history of heavily favoring Lada (a Russia car manufacture) by keeping competition costly with high import costs. Another factors include the desire to get foreign car manufactures to set up plants within Russia (providing Russians jobs), cut the amount of money leaving Russia, and to be less dependent on the used car market.
On the bright side for Japan’s exporters, the idea of raise used car import duty is not new. In fact it has been discussed many times, but dropped when the far-east Russians protested. This is because the majority of the far east Russia relies on Japanese and Korean used cars which are affordable for those living in that market.
Continuing our series all about the different types of vehicles you can find from Japanese used car exporters, this time we will focus on the Honda Integra Type R. Coming from one of the most popular manufactures for cars, the Integra Type R is of the sporty variety, popular about car enthusiasts and car tuners.
For those who are unfamiliar with a somewhat common terminology, not all Integras are Type R. Type R refers to the “Racing” type of a vehicles (same as Civic Type R), which involves the car’s weight being reduced by taking anything unnecessary out and also using more performance-orientated parts for vital systems. The other way to look at it is that a Type R car is generally more uncomfortable, noisier, and much less “options” that would otherwise weigh down the car. As an example, here is a 2000 Honda Integra Type R:
When considering if there is a market for these types of vehicles in your country, you must also consider import rules concerning these cars. Often, they are using after market parts instead of the standard stock parts and because of that, they may not qualify to come into your country. On the other hand some countries don’t mind you import special vehicles as long as they pass safety and emission tests (such as Australia).
Even if you don’t particularly like these types of cars as an importer, maybe there is niche market where you are for these types of vehicles. Another benefit is the cars generally produce very passionate crowds that are willing to go extra lengths to purchase such a vehicle.
Looking around to find the most opposite vehicle I could to the last car we’ve highlighted (the Toyota Landcruiser Prado), I found the 2001 Mercedes-Benz A-class 5d A160. Compared to the Landcrusier Prado, there seems nothing similar except that it’s a vehicle. The A-class is a much smaller 5door (hatchback), German, in the sub-compact class, much more efficient (13.2km each liter or 4.9L for each 100km), and much different styling. Here’s some photos of the vehicle:
It’s not a beast. It’s the complete opposite. Maybe you or your customers are looking from something that is effecient and fitting for a city. Having such a small car (although not a Kei) is a big benefit in many ways. Also, perhaps you can find the European look stylish to your taste. However it is, if you or your customers are liking this, don’t forget that you can get them in Japan. Japan has both LHD and RHDs of these models (although more often you will see RHDs).
The Toyota Landcruiser Prado has been a very popular SUV in Japan and other nations. The most obvious difference of it (the Prado) and the normal is that it’s noticably smaller. It goes by the name Lexus GX 470 in the United States, but it is still called Land Cruiser Prado in many other countries such as Australia, South Africa, and in the Middle East and Latin America.
To give an example, our friends at JCarBuys have a 2007 Toyota Landcruiser Prado available on stock. Here are some photos of how it looks:
As you can see, the Prado is very attractive and popular with importers in many countries that desire or need these types of vehicles. They also come with a lot of equipment. Here a list of some things you can see found in this type of car:
automatic air conditioning (climate control), anti-lock brakes, alloy wheels, power steering, power windows, sun roof, supplemental restraint system (air bags), four wheel drive, cd player, television, navigation, leather seats, stereo, tiptronic, 7-seats, and more.
Remember when your looking at different years in the Land Cruiser Prado model range, there are different different model generations:
First came the LC 70-Light series built on the J7 platform which was between 1984 and 1990
Second came the LC 70-Series also built on the J7 platform from 1990 to 1996
The LC 70-Series was replace by the LC 90-Series (J9 platform) during 1996 which last till 2002
Currently, the LC 120-Series has been in production on the J12 platform since 2003
You might want to consider such a vehicle for you and your customers if small, classy SUVs are popular in your country.
According to UB Post (Mongolian news agency), the Mongolian Parliament is looking to increase excise taxes on used cars to stem import levels.
Mongolia has been experiencing all time high car import levels these recent years. And as more young men and women come to driving age the expect a very large increase of drivers in the next 5 years. Unfortunately, the infrastructure in Mongolia is not prepared to handle the new massive load and Ulaanbaatar’s (the capitol) roads are already being pushed to their limits.
Mongolian car traders and exporters alike may want to complete deals before the proposal gets approved in Parliament and new import taxes rates are implemented (possibly).
Right now the world is experiencing ups and downs in its economy. Besides US, Japan also has been affected. What about your country?
Data has not been yet produced (we’ll have to wait about a month), but has it been affecting your sells/purchases? While nations connect more directly to Western nations haves seen some fall, the are also many nations that continue to experience growth. Please let us know how your nation is doing in the comments section below.
I was able to obtain the statistics of how many used passenger* cars have been export from Japan during January to June. The statistics do not include trucks and other commerical/non-passenger type vehicles.
Overall Used Passenger Exports from January 2008 to June 2008
Car Units: 579,582
Value: ¥352,310,171,000
(or at today’s exchange rate: $3,249,516,575)
Over three billion (milliard) US Dollars! That’s a whole lot of money for used cars alone.
Top 10 Destinations
Rank Country | Car Units | Value(Japanese Yen)
1: RUSSIA | 260,008 | 163,251,031,000
2: CHILE | 55,461 | 11,744,217,000
3: UAE | 37,167 | 9,321,093,000
4: NEW ZEALAND | 35,640 | 17,991,266,000
5: MONGOLIA | 14,322 | 4,342,595,000
6: KENYA | 13,013 | 7,342,810,000
7: SOUTH AFRICA | 12,904 | 3,545,133,000
8: SINGAPORE | 12,894 | 21,078,435,000
9: MALAYSIA | 12,746 | 25,317,559,000
10: BANGLADESH | 10,208 | 10,706,168,000
Russia remains #1 way ahead of everyone as Japan is supplying their used car market rapid expansion. Others continue to remain strong, although old partner New Zealand has slowed down its imports since the new emission regulations have taken affect. Newcomers to the Top 10, Mongolia and Bangladesh, have seen recent sharp rises due to mostly political and somewhat economical changes. They’ve replaced Pakistan (19th) – which has gone through extreme political unrest, and United Kingdom (11th) which has seen reduced demand that is possibly related to economic downturn/unrest.
Together, the top 10 represent roughly 80% of the used passenger vehicles exported from Japan and 78% of the total value of the cars. Thus the top 10 importers hold a landslide majority of sales Japanese used car exporters have made.
Top 20 & 50
Adding the next 10 (Top 20) would make it 90% of car units and 88.5% of total cash amount. Counting the top 50 together will make it roughly 99% of both car units sold and total value.
Draw you own conclusions. The data is quite clear, and if your an exporter, you should have a clear idea what to do. If you want to look at the full data, you can do so by going to:
Note: Car Units and Value data for each country comes from Japan Customs Statistics Office. All other data is calculated by me. Percentages and VPUs are rounded to simplify view.
Philippines Gov has taken great lengths to shut down all illegal importing of used passenger cars. It was a thriving business, but it depended on corrupt custom’s officials. As it reached nation attention, those who were abusing their power were removed and illegal imports were being confiscated. It seems for at least the short term that car imports are frozen.
HOWEVER… Importing diesel commercial vehicles is legal and still being done. Most importing is done through the Subic Bay Freeport Zone and the vehicles are converted to LHD.
Since our last post on the situation in Phillippines (read Import News For Phillipines), a series or rapid event have been taking place. It was just recently revealed that 5 government agencies purposly neglected to uphold the ban and there are a number of senators that disagree with the ban.
Just at the end of last month a Supreme Court ruling ruled in favor of the ban. But senators are still defying the ruling they feel is wrong. The problem is that the ban is an Executive Order (EO) made by the President rather than a bill/law passed by the Senate. The senators in objection feel that this area the EO affects is the Senate’s territory.
We must wait to see what will be the result of this: Either the ban stays and questionable import practices are stopped or the ban might be lifted. It’s question of who has the most authority.
Recently, there has been some increase of import used cars to Cyprus attributed to two things done by the Government. First, access to importing used cars has increased as anybody can import a used car. This increases the overall amount of importers (and customers to exporters).
The second policy that help increase trade was a move by the government to get old cars off the road and replacing them with new, more recent models. Owners of cars that are older than 15 years were offered money to replacing their vehicle with more environmentally friendly cars. People could get between 256 Euro and 1,708 Euro depending on what they were withdrawing from registry or how effiecent a car they were buying.
The Cyprus government find this scheme as a huge sucess for the country and the environment. They are looking forward to possibly continuing the scheme in 2009.
Finding the Japanese car that you want can sometimes be difficult. Instead of getting frustrated and giving up, here are some useful tips to overcome minor problems.
First, let me express some problems you might face:
The model name in Japan might be different from the one where you live.
The car seems to be sold in other layout (coupe, sedan/saloon, etc.) than you want.
You don’t know if the “year” is the manufacture year or first registration year.
These problem can be answered by knowing just a small piece of information. For example, knowing the car chassis number can help you know the particular model, it’s years of production (for that version), and what layout that car is. This number is important because it only gets changed when significant changes are made to a model.
For example, a Honda EK9 is a Civic Type R 3-door hatchback produced between 1997 and 2000. The EP3 is the next generation Civic Type R that was made from 2001 to 2005. On the other hand a Honda EU is a Civic 5-door hatchback built between 2001-2005.
Here are some useful websites to go to:
Wikipedia – Provides information on alternative names for cars, shows the various layouts are car can be found, provides model chassis codes, and other multi-national information. Unfortuantely it is not perfect because of the heavy United States influnce but it still has plenty of usefulness.
Cars-Directory.net – One of many sites that give detailed information on particular models. Also has many pictures available to look at and compare.
Do you have other suggestions? or do you have other questions on how to find the right vehicle? Please write them in the Comments section below!
WTO – World Trade Organization – is an excellent organization to increase trade between participating countries. That why most nation have an agreement with WTO or are trying to join. Of course, free trade must go both ways (export and import) to be truely free. And WTO job is to make sure are countries are fair.
So how does this related to Japanese used car exports and the Bahamas? Well it might not be important to all exporters, but there are some that do export to the Bahamas. For those who do and appreciate small country news, the Bahamas might have to relax it tariffs if they don’t find a good excuse (and maneuvering) on why they should maintain their high tariffs for transport sector imports.
Because 40% of the Bahamas’ imports are transport related (new and used cars, parts, and fuel), they’ve grown used to the extra revenue and need to keep the budget balanced. WTO says this is violation of free trade and an act of protectionism. If the Bahamas’ government doesn’t make a reason to keep high taxes (such as for “enviornmental reasons”), they may be forced to reduce tariff rates for imports.
TAA (Toyota Auto Auction) is another type of auto auction found in Japan. This group of 9 auction house was created for Toyota dealers to sell any unwanted cars, such as older cars customers traded in while buying from the dealer. Not only are there such auctions available for Toyota dealers, but there is HAA (Honda), SAA (Suzuki), SUAA (Subaru), NAA/NTAA (Nissan), MAA (Mitsubishi), and IMA (Isuzu).
One advantage TAA has over most of it competing auto auctions is that they publish higher quality images of vehicles from the inspection. While most auto auctions have 300px by 225px photos of the cars, TAA saves photos at 640px by 480px. So in a real way TAA gives auction bidders a “clearer” picture of what condition the car is before the auction begins.
More information is available on the Japanese website: TAA Web (Japanese)
The National Board of Revenue (NBR) of Bangladesh is looking into the possiblity of people importing brand new cars as “reconditioned” cars, mostly from Japan.
As many Japanese used car exporters are aware, brand new vehicles are quickly registered and de-registered to circumevent Japanese laws forbidding anyone besides the manufacturer from exporting new vehicles. Technically, in the eyes of the law these are no longer brand new vehicles, just new or “as-new” vehicles. Why this matter to Bangladesh NBR is that they make 50% higher import duty on cars imported as new.
To counter this, it is proposed for the new budget that for a vehicle to be considered a “reconditioned” car, it must have a space 365 days between registration and deregistration and have clocked at least 1,000 km of mileage. They hope this will close the loop hole.
It’s not all bad news for importers though. Also in the proposed budget, the government will reduce supplementary duties from 60 percent to 20 percent on import of ordinary non-luxurious microbuses with and engine size between 1500 to 1800 CC which are used for transportation of industrial raw materials and/or passengers.
From 1 July 2008 in Ireland, Category “A” cars will be taxed based on the level of CO2 emissions and not engine size as before. Also, the 50% discount of VRT payable for hybrid electric and flexible fuel vehicles is replaced by VRT relief of up to €2,500 depending on the car’s age (for hybrids only). This will only apply to car registered after 30 June, while cars imported before will continue under the old system.
According to The Irish Revenue Commissioner’s Leaflet:
New Tax Regime
From 1 July 2008, VRT payable on category A vehicles will no longer be based on the engine size but rather on the level of CO2 emissions from the car. Linking the VRT rates to the level CO2 emissions will mean that individuals purchasing cleaner, low emission cars will pay less VRT while those opting to purchase higher emitting vehicles will pay more.
A seven-band CO2 emission system will apply. VRT will now be charged as a percentage of the OMSP (Open Market Selling Price) in accordance with the following table:
CO2 Emissions (CO2g/km)
VRT Rates
0 – 120g
14% of OMSP
More than 120g/km up to and including140g/km
16% of OMSP
More than 140g/km up to and including 155g/km
20% of OMSP
More than 155g/km up to and including 170g/km
24% of OMSP
More than 170g/km up to and including 190g/km
28% of OMSP
More than 190g/km up to and including 225g/km
32% of OMSP
More than 225g/km
36% of OMSP
Importers of Japanese used cars must have the CO2 Emissions levels declared on their Export or Deregistration Certificate, or have a printout emissions certificate for your particular model from the Japanese Ministry of Land, Infrastructure and Transport. If you don’t have proof, you will be charged the highest rate (36%) regardless of how efficient the car is.
Also, as an incentive to by eco-friendly cars, you can get reductions based the car age for hybrids. That is, the younger the car is, more money is deducted. Of course there is a minimum amount that still must be paid, but here are the discount rates:
Hybrid, flexible fuel and electric vehicles
The current relief of 50% reduction of the VRT payable on Hybrid and Flexi Fuel vehicles is withdrawn from 30 June 2008.
A VRT remission up to a maximum of €2,500 will be available on such cars registered between 1 July 2008 and 31 December 2010.
This relief is limited, on a sliding scale, depending on the age of the vehicle. The scale is as follows:
Age of vehicle
Maximum amount which may
be remitted or repaid
New vehicle, first registration
€2,500
Not a new vehicle but less than 2 years
€2,250
2 years or over but less than 3 years
€2,000
3 years or over but less than 4 years
€1,750
4 years or over but less than 5 years
€1,500
5 years or over but less than 6 years
€1,250
6 years or over but less than 7 years
€1,000
7 years or over but less than 8 years
€750
8 years or over but less than 9 years
€500
9 years or over but less than 10 years
€250
10 years or over
Nil
With effect from 1 January 2008 to 31 December 2010, series production electric vehicles and electric motorcycles are exempt from VRT.
Note: There is no change for Category B (crew cabs, etc.), Category C (commercial vehicles) or Category M (motorcycles – other than electric motorcycles).
In the proposed budget for the 2008-09 fiscal year (FY) the government has suggested the following:
20 per cent SD (Supplementary Duty) on vehicles of up to 1500cc
60 per cent SD on vehicles between 1,501 and 2,350cc
100 per cent SD on vehicles between 2,351cc and 3,500cc.
This rates are only applied to used, also called reconditioned, cars. It may change before the budget is put into effect as the Bangladesh Reconditioned Vehicles Importers and Dealers Association (BARVIDA) argues it should be reduced.
BARVIDA believes that raise the taxes on reconditioned car imports will hold back the current progress the economy is experiencing. The connection is that many small and medium businesses rely on the cheaper used car imports to do their business. We will have to see what comes as most vehicles imported come from Japan.
The recent decision of the Cabinet’s Services Committee will further restrict the imports of used vehicles into UAE starting January 2009. There will be an import ban on used light cars that are older than 5 years, and heavy vehicles are not allow if older than 7 years.
In good news, light cars over 20 years old are banned in the United Arab Emirates. This will push people to buy newer, better cars. And those vehicles can be from Japan.
Bay Auc is a well known auto auction in Japan. One particular advantage this auto auction has over many other auctions is its location. It is situated in an very good location in Osaka, one of the biggest international shipping ports of Japan. The city itself is second only to Tokyo in economical power. You will find that many Japanese used car exporters are either based in the Osaka area or heavily use the Osaka Port for shipping vehicles.
The car auction promises to exhibit at least 3,500 to 4,000 cars every Wednesday starting at 9 AM. It has two simultaneous auction “lanes” running at 400 images an hour. Auction lanes are where they have more than one car being auctioned at any moment. This makes getting through the thousands of cars possible. Bay Auc is not the biggest auction, but they do a good job and have many cars to go through.
Japanese Used Car Importing Weblog 