Japanese used vehicle exporting
Encyclopedia
Japanese used vehicle exporting is international trade
involving the export of used cars and other vehicles from Japan to other markets around the world. Despite the high cost of transport, the sale of used cars and other vehicles to other countries is still profitable due to the relatively low cost and good condition of the vehicles being purchased. Contributing factors to the feasibility of such export include Japan's strict motor-vehicle inspections
and high depreciation
which make such vehicles worth very little in Japan after six years, and strict environmental-protection regulations that make vehicle disposal very expensive in Japan. Japan has very stringent vehicle emission test standards.
Due to progressively escalating costs of passing the mandatory periodic vehicle inspection, cars are typically scrapped or exported for sale abroad by the time they're about 10 years old. Engines removed from scrapped vehicles are in some cases exported for sale outside of Japan.
Nearly 1.4 million used vehicles were exported from Japan in 2006. The most popular destinations for used cars from Japan are Bangladesh
, Russia
, New Zealand
, United Kingdom
, Australia
, Ireland
, Pakistan
,Dominican Republic
, Peru
, Bolivia
, Paraguay
, Kenya
, and the Philippines
. Additionally, Chile
, Singapore
, South Africa
and the United Arab Emirates
are used as popular transit hubs.
Besides auto auctions, Japanese exports have access to vehicles from dealerships and private sellers.
risks. Car cleaning is especially necessary for Australia's AQIS
and New Zealand's Ministry of Agriculture and Forestry (MAF)
agencies' clearances.
Exporters can ship the car that is ready by Ro/Ro or Container
according to customer specification, ship schedules, and the capabilities of the destination port.
regulations also differ substantially from the ECE Regulations used throughout most of the world and the U.S. North American regulations
that apply in the United States
and Canada
. Vehicle components such as windows and windshield
s, seat belt
s, lamps and reflectors
, and mirrors
, as well as design features for crashworthiness such as bumpers, fuel tanks, and structural rigidity of vehicles meant for the Japanese market may not comply with non-Japanese standards. They often lack strutural reinforcements needed to meet side-impact crashworthiness standards in effect outside Japan. Moreover, entire categories of vehicle, such as Kei car
s, do not exist in regulations outside of Japan.
applies strict control on imports. In order to import a car, it must be either built before January 1, 1989, a private import, or imported under the RAWS (Registered Automotive Workshop Scheme). RAWS uses professional workshop limited to 100 vehicles each to certify that an imported vehicle meets safety and emission standards called Australian Design Rules
. Only vehicles listed on the approved list (SEVS) can be imported.
also applies strict control on imports. In order to import a car, it must be not more than 3 years old. Extremely high importation taxes are levied on imported vehicles. Special ships are sometimes used for exporting vehicles to Pakistan, to meet the rising demand.
has relatively loose vehicle importing laws for Japanese cars. To keep imports down, Irish Revenue Commissioners require all new and imported cars to pay the Vehicle Registration Tax
.
clearance and Customs clearance, a vehicle must be Entry Certified by a Transport Services Delivery Agent (TSDA) which includes seeing paper data and physical data meet safety, emissions, and fuel consumption standards.
are stringent; all vehicles must undergo Individual Vehicle Approval to assure compliance with applicable ECE Regulations or British national equivalents. The speedometer
must be converted from kilometres per hour to miles per hour, a rear fog light
and unleaded-fuel restrictor installed.
s and other lights and reflectors
, the window glass, the tires, the seatbelts, and other equipment.
International trade
International trade is the exchange of capital, goods, and services across international borders or territories. In most countries, such trade represents a significant share of gross domestic product...
involving the export of used cars and other vehicles from Japan to other markets around the world. Despite the high cost of transport, the sale of used cars and other vehicles to other countries is still profitable due to the relatively low cost and good condition of the vehicles being purchased. Contributing factors to the feasibility of such export include Japan's strict motor-vehicle inspections
Motor-vehicle inspection (Japan)
, a contraction of , is the name of the vehicle inspection program in Japan for motor vehicles over 250 cc in engine displacement.- Reason for existence :...
and high depreciation
Depreciation
Depreciation refers to two very different but related concepts:# the decrease in value of assets , and# the allocation of the cost of assets to periods in which the assets are used ....
which make such vehicles worth very little in Japan after six years, and strict environmental-protection regulations that make vehicle disposal very expensive in Japan. Japan has very stringent vehicle emission test standards.
Due to progressively escalating costs of passing the mandatory periodic vehicle inspection, cars are typically scrapped or exported for sale abroad by the time they're about 10 years old. Engines removed from scrapped vehicles are in some cases exported for sale outside of Japan.
Nearly 1.4 million used vehicles were exported from Japan in 2006. The most popular destinations for used cars from Japan are Bangladesh
Bangladesh
Bangladesh , officially the People's Republic of Bangladesh is a sovereign state located in South Asia. It is bordered by India on all sides except for a small border with Burma to the far southeast and by the Bay of Bengal to the south...
, Russia
Russia
Russia or , officially known as both Russia and the Russian Federation , is a country in northern Eurasia. It is a federal semi-presidential republic, comprising 83 federal subjects...
, New Zealand
New Zealand
New Zealand is an island country in the south-western Pacific Ocean comprising two main landmasses and numerous smaller islands. The country is situated some east of Australia across the Tasman Sea, and roughly south of the Pacific island nations of New Caledonia, Fiji, and Tonga...
, United Kingdom
United Kingdom
The United Kingdom of Great Britain and Northern IrelandIn the United Kingdom and Dependencies, other languages have been officially recognised as legitimate autochthonous languages under the European Charter for Regional or Minority Languages...
, Australia
Australia
Australia , officially the Commonwealth of Australia, is a country in the Southern Hemisphere comprising the mainland of the Australian continent, the island of Tasmania, and numerous smaller islands in the Indian and Pacific Oceans. It is the world's sixth-largest country by total area...
, Ireland
Ireland
Ireland is an island to the northwest of continental Europe. It is the third-largest island in Europe and the twentieth-largest island on Earth...
, Pakistan
Pakistan
Pakistan , officially the Islamic Republic of Pakistan is a sovereign state in South Asia. It has a coastline along the Arabian Sea and the Gulf of Oman in the south and is bordered by Afghanistan and Iran in the west, India in the east and China in the far northeast. In the north, Tajikistan...
,Dominican Republic
Dominican Republic
The Dominican Republic is a nation on the island of La Hispaniola, part of the Greater Antilles archipelago in the Caribbean region. The western third of the island is occupied by the nation of Haiti, making Hispaniola one of two Caribbean islands that are shared by two countries...
, Peru
Peru
Peru , officially the Republic of Peru , is a country in western South America. It is bordered on the north by Ecuador and Colombia, on the east by Brazil, on the southeast by Bolivia, on the south by Chile, and on the west by the Pacific Ocean....
, Bolivia
Bolivia
Bolivia officially known as Plurinational State of Bolivia , is a landlocked country in central South America. It is the poorest country in South America...
, Paraguay
Paraguay
Paraguay , officially the Republic of Paraguay , is a landlocked country in South America. It is bordered by Argentina to the south and southwest, Brazil to the east and northeast, and Bolivia to the northwest. Paraguay lies on both banks of the Paraguay River, which runs through the center of the...
, Kenya
Kenya
Kenya , officially known as the Republic of Kenya, is a country in East Africa that lies on the equator, with the Indian Ocean to its south-east...
, and the Philippines
Philippines
The Philippines , officially known as the Republic of the Philippines , is a country in Southeast Asia in the western Pacific Ocean. To its north across the Luzon Strait lies Taiwan. West across the South China Sea sits Vietnam...
. Additionally, Chile
Chile
Chile ,officially the Republic of Chile , is a country in South America occupying a long, narrow coastal strip between the Andes mountains to the east and the Pacific Ocean to the west. It borders Peru to the north, Bolivia to the northeast, Argentina to the east, and the Drake Passage in the far...
, Singapore
Singapore
Singapore , officially the Republic of Singapore, is a Southeast Asian city-state off the southern tip of the Malay Peninsula, north of the equator. An island country made up of 63 islands, it is separated from Malaysia by the Straits of Johor to its north and from Indonesia's Riau Islands by the...
, South Africa
South Africa
The Republic of South Africa is a country in southern Africa. Located at the southern tip of Africa, it is divided into nine provinces, with of coastline on the Atlantic and Indian oceans...
and the United Arab Emirates
United Arab Emirates
The United Arab Emirates, abbreviated as the UAE, or shortened to "the Emirates", is a state situated in the southeast of the Arabian Peninsula in Western Asia on the Persian Gulf, bordering Oman, and Saudi Arabia, and sharing sea borders with Iraq, Kuwait, Bahrain, Qatar, and Iran.The UAE is a...
are used as popular transit hubs.
Supply of used cars
In Japan, used cars are mainly sold at auto auctions by car owners and dealers. At auto auctions, owners are hidden from bidders while the auctioneers provide independent car evaluations called inspection sheets. Exporters, acting as bidding agents for importers, use the auto auctions as their main supply. There are over 200 auto auction groups operating throughout Japan including JAA, JU Group, TAA, USS, and ZIP.Besides auto auctions, Japanese exports have access to vehicles from dealerships and private sellers.
Exporting methods
Vehicles which will be exported from Japan must be prepared before shipping. This includes de-registering the vehicle with the government, getting an export certificate, and cleaning the car to remove biosecurityBiosecurity
Biosecurity is a set of preventive measures designed to reduce the risk of transmission of infectious diseases, quarantined pests, invasive alien species, living modified organisms...
risks. Car cleaning is especially necessary for Australia's AQIS
Australian Quarantine and Inspection Service
The Australian Quarantine and Inspection Service is the Australian government agency responsible for enforcing Australian quarantine laws...
and New Zealand's Ministry of Agriculture and Forestry (MAF)
Ministry of Agriculture and Forestry (New Zealand)
The Ministry of Agriculture and Forestry is the state sector organisation of New Zealand which deals with matters relating to agriculture, forestry and biosecurity...
agencies' clearances.
Exporters can ship the car that is ready by Ro/Ro or Container
Containerization
Containerization is a system of freight transport based on a range of steel intermodal containers...
according to customer specification, ship schedules, and the capabilities of the destination port.
Market differences
The suitability of Japan's domestically sold cars for export to other countries is constrained by various factors. Vehicles in Japan have right-hand drive—the driver's seat is on the right side of the vehicle—in accord with Japan's left-hand traffic. Some countries with right-hand traffic permit right-hand drive vehicles, though right-traffic headlamps are generally unavailable for models exclusive to Japan. Some countries with right traffic do not allow right-hand drive cars, but in some such markets the extensive labor required to convert a car to left-hand drive is economically feasible; such conversions are sometimes done by the local importers. The Philippines is an example of a market where such conversion is common. Japan's automobile safetyAutomobile safety
Automobile safety is the study and practice of vehicle design, construction, and equipment to minimize the occurrence and consequences of automobile accidents. Automobile safety is the study and practice of vehicle design, construction, and equipment to minimize the occurrence and consequences of...
regulations also differ substantially from the ECE Regulations used throughout most of the world and the U.S. North American regulations
National Highway Traffic Safety Administration
The National Highway Traffic Safety Administration is an agency of the Executive Branch of the U.S. government, part of the Department of Transportation...
that apply in the United States
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
and Canada
Canada
Canada is a North American country consisting of ten provinces and three territories. Located in the northern part of the continent, it extends from the Atlantic Ocean in the east to the Pacific Ocean in the west, and northward into the Arctic Ocean...
. Vehicle components such as windows and windshield
Windshield
The windshield or windscreen of an aircraft, car, bus, motorbike or tram is the front window. Modern windshields are generally made of laminated safety glass, a type of treated glass, which consists of two curved sheets of glass with a plastic layer laminated between them for safety, and are glued...
s, seat belt
Seat belt
A seat belt or seatbelt, sometimes called a safety belt, is a safety harness designed to secure the occupant of a vehicle against harmful movement that may result from a collision or a sudden stop...
s, lamps and reflectors
Automotive lighting
The lighting system of a motor vehicle consists of lighting and signalling devices mounted or integrated to the front, sides, rear, and in some cases the top of the motor vehicle...
, and mirrors
Wing mirror
A wing mirror is a mirror found on the exterior of motor vehicles for the purposes of helping the driver see areas behind and to the sides of the vehicle, outside of the driver's peripheral vision .Although almost all modern cars mount their side mirrors on the doors, normally at the "A" pillar,...
, as well as design features for crashworthiness such as bumpers, fuel tanks, and structural rigidity of vehicles meant for the Japanese market may not comply with non-Japanese standards. They often lack strutural reinforcements needed to meet side-impact crashworthiness standards in effect outside Japan. Moreover, entire categories of vehicle, such as Kei car
Kei car
Kei cars, K-cars, or , are a Japanese category of small vehicles, including passenger cars, vans, and pickup trucks. They are designed to comply with Japanese government tax and insurance regulations, and in most rural areas are exempted from the requirement to certify that adequate parking is...
s, do not exist in regulations outside of Japan.
Responsibilities
Generally, most exporters are responsible for the organization and completion of the vehicle's transportation till it arrives at the importer's Port of Destination (POD). At the POD, possession of the vehicle, and the responsibility of possession, is laid on the importer. Financial responsibility, on the other hand, is transferred when ownership is handed over. Ownership is switched after the car has been purchased and before being exported. In the case of damage or losses occurring during shipping, the buyer is the one bears all financial loss.Australia
AustraliaAustralia
Australia , officially the Commonwealth of Australia, is a country in the Southern Hemisphere comprising the mainland of the Australian continent, the island of Tasmania, and numerous smaller islands in the Indian and Pacific Oceans. It is the world's sixth-largest country by total area...
applies strict control on imports. In order to import a car, it must be either built before January 1, 1989, a private import, or imported under the RAWS (Registered Automotive Workshop Scheme). RAWS uses professional workshop limited to 100 vehicles each to certify that an imported vehicle meets safety and emission standards called Australian Design Rules
Australian Design Rules
The Australian Design Rules are national Australian standards for vehicle safety, anti-theft system and emission standards. They have been acclaimed as less arbitrary than those of other countries, and successfully prevented the importation of many dangerous Japanese imports over the years...
. Only vehicles listed on the approved list (SEVS) can be imported.
Pakistan
PakistanPakistan
Pakistan , officially the Islamic Republic of Pakistan is a sovereign state in South Asia. It has a coastline along the Arabian Sea and the Gulf of Oman in the south and is bordered by Afghanistan and Iran in the west, India in the east and China in the far northeast. In the north, Tajikistan...
also applies strict control on imports. In order to import a car, it must be not more than 3 years old. Extremely high importation taxes are levied on imported vehicles. Special ships are sometimes used for exporting vehicles to Pakistan, to meet the rising demand.
Ireland
IrelandIreland
Ireland is an island to the northwest of continental Europe. It is the third-largest island in Europe and the twentieth-largest island on Earth...
has relatively loose vehicle importing laws for Japanese cars. To keep imports down, Irish Revenue Commissioners require all new and imported cars to pay the Vehicle Registration Tax
Vehicle Registration Tax
Vehicle registration tax or VRT is a tax that must be paid in Ireland when registering a motor vehicle.The tax is paid to the Revenue in two ways:*VRT is included in the retail price of a new motor vehicle purchased from a dealership...
.
New Zealand
New Zealand has stringent safety and emission standards. Besides BiosecurityBiosecurity
Biosecurity is a set of preventive measures designed to reduce the risk of transmission of infectious diseases, quarantined pests, invasive alien species, living modified organisms...
clearance and Customs clearance, a vehicle must be Entry Certified by a Transport Services Delivery Agent (TSDA) which includes seeing paper data and physical data meet safety, emissions, and fuel consumption standards.
United Kingdom
Importing rules for the UKUnited Kingdom
The United Kingdom of Great Britain and Northern IrelandIn the United Kingdom and Dependencies, other languages have been officially recognised as legitimate autochthonous languages under the European Charter for Regional or Minority Languages...
are stringent; all vehicles must undergo Individual Vehicle Approval to assure compliance with applicable ECE Regulations or British national equivalents. The speedometer
Speedometer
A speedometer is a gauge that measures and displays the instantaneous speed of a land vehicle. Now universally fitted to motor vehicles, they started to be available as options in the 1900s, and as standard equipment from about 1910 onwards. Speedometers for other vehicles have specific names...
must be converted from kilometres per hour to miles per hour, a rear fog light
Automotive lighting
The lighting system of a motor vehicle consists of lighting and signalling devices mounted or integrated to the front, sides, rear, and in some cases the top of the motor vehicle...
and unleaded-fuel restrictor installed.
Canada
Any vehicle more than 15 years old may be imported to Canada without regard to its compliance with Canada Motor Vehicle Safety Standards. However, vehicles are registered at the provincial level in Canada, and increasingly-stringent provincial vehicle safety requirements make it difficult to register a Japanese-market vehicle without replacement or modifications to the headlampHeadlamp
A headlamp is a lamp, usually attached to the front of a vehicle such as a car or a motorcycle, with the purpose of illuminating the road ahead during periods of low visibility, such as darkness or precipitation. Headlamp performance has steadily improved throughout the automobile age, spurred by...
s and other lights and reflectors
Automotive lighting
The lighting system of a motor vehicle consists of lighting and signalling devices mounted or integrated to the front, sides, rear, and in some cases the top of the motor vehicle...
, the window glass, the tires, the seatbelts, and other equipment.