Is Ecuador really a blue ocean market for novices exporting used cars?

Many domestic car dealers are staring at the Ecuadorian used car market. The premium for new cars is relatively high there, and the demand for domestic used cars is still quite strong. However, it is easy for novices to step in. The vehicles are detained when they arrive in the port, have to pay high fines for customs clearance, and the vehicles are too old. They will also be returned if they exceed the standard, causing losses of hundreds of thousands of yuan at every turn.

1. Draw a red line first: Ecuador has a rigid threshold for the import of used cars, which must be checked before collecting cars

1. Vehicle age limit is 5 years

The calculation node is based on the factory year of the vehicle, and customs clearance cannot be achieved for more than a year; no matter how cheap domestic scooters on the market are on the market are, no matter how cheap they are, the local customs will check the VIN and check the factory date, and there is no room at all.

2. Displacement does not exceed 3000cc

SUVs and family cars are basically no problem. Large-displacement off-road models and models above 3.0T are directly excluded. Large-displacement used cars are not accepted in private import channels.

3. Bulk customs clearance is limited to overseas Chinese for personal use

Ordinary traders in Ecuador cannot import second-hand complete vehicles alone. Second-hand cars that can circulate normally on the market all rely on the "Returned Overseas Chinese Household Baggage" policy to enter the customs. This is a key point that novices can easily ignore. Supporting restrictions: The declared value of vehicles is capped at US$20000. Resale and transfer are not allowed within 3 years after entering the customs. This clause must be clearly written in contracts with foreign buyers to avoid subsequent disputes.

4. Emissions and safety standards

Vehicles must meet the environmental protection standards of the Andean region. Fault codes and exhaust gas must be cleared in advance before departure; lights, brakes, and seat belts must be repaired in good condition. Local customs will conduct a simple vehicle condition test and directly detain the vehicle if it fails to pass the test. Supplement: Only left-hand rudder vehicles are allowed to be imported. Conventional domestic family vehicles have no pressure and no additional rudder changes are required.

2. There are two starting modes for novices, without having to register a full set of qualifications at once

Many personal car dealers and small car dealers backed out when they heard that they wanted to apply for second-hand car export qualifications. In fact, newbies have two options and choose according to their needs:

Mode 1: Asset-light export (preferred for 90% of novices)

You don't have to go to the Ministry of Commerce for filing or hire certified assessors. You don't have to find a local trading company with formal second-hand car export qualifications to cooperate.

operational flow

1. Finalize the model, price, and delivery date with local buyers in Ecuador, and sign an export contract;

2. The deposit from foreign customers is transferred to the foreign exchange account of the cooperation qualified company, and the safety of funds is guaranteed;

3. You collect the car, settle all illegal mortgages, transfer the transfer to the name of the qualified company, the registration certificate is marked "Transfer pending export", and apply for a 60-day temporary license plate;

4. The cooperative company handles the full set of procedures for one vehicle inspection, export license, customs declaration, sea transportation, and certificate of origin;

5. After the vehicle leaves the port and the foreign exchange is received, the agency fee and logistics fee will be deducted, and the remaining payment will be settled to you. Advantages: Low initial investment, no need to go through qualification procedures, and all customs declarations can be outsourced if you don't understand documents and customs declarations; suitable for novices who are testing the water for the first time and have 1-10 units per departure.

Mode 2, apply for export qualifications yourself (consider again if the volume is stable in the long term)

Enterprises need a business license, fixed exhibition hall space, and 3 certified used car assessors, prepare audit reports and venue certificates, submit applications in the business system of the Ministry of Commerce, and review and approval by the provincial commerce department within 15 working days, and need to review qualifications every year.

For those practitioners who can steadily ship out dozens of units every month and expect to work deeply in the South American market for a long time, they can control the pace of documentation and logistics without having to pay agency service fees for a long time.

3. The complete domestic departure process cannot be saved at all

1. Pre-vehicle pickup verification

Check as soon as you get the registration certificate: factory year, displacement, mortgage availability, unprocessed violations, major accidents, blisters and fires; cars with property rights disputes and incomplete files will not be accepted, and the transfer process will be stuck. Simply clean up the car after picking up, wash the interior and exterior, repair the broken lights, and eliminate the engine fault codes. This will not only make foreign buyers more recognized, but also avoid failing overseas tests.

2. Transfer + third-party testing

When the vehicle is transferred to the name of an export-qualified enterprise, the vehicle management office will endorse "Transfer pending export"; find a CMA qualified testing institution to inspect each vehicle and issue a special export-specific inspection report. This report is the core material for applying for an export license and cannot be cleared.

3. apply for export license

Log in to the unified platform of the Ministry of Commerce to upload the export contract, registration certificate, and test report, and issue the certificate in about 3 working days. Each license corresponds to the VIN code for each vehicle, and one license for each batch. Information entry error will be directly rejected, and check twice more when checking the frame number.

4. document preparation

Basic information for domestic customs declaration: commercial invoices, packing lists, export licenses, customs declarations, ocean bills of lading;

Ecuadorian exclusive customs clearance documents

1. Certificate of origin in China: The core certificate of local tariff reduction and exemption shall be processed simultaneously before departure and cannot be replenished later;2. Vehicle property rights certificate and translation of car purchase invoice 3. Entrust the local customs clearance bank to prepare a complete set of identity materials imported from returned overseas Chinese in advance (provided by the buyer in advance).

5. Shipping customs declaration + domestic cancellation

Domestic ports have completed customs declaration and loading, and the common route is direct to the domestic port of Guayaquil, with a voyage of about 30 days;

Within 2 months after the vehicle passes customs clearance, go to the vehicle management office to cancel the vehicle with the customs declaration form. Don't let the vehicle remain in a "waiting for export" state for a long time, otherwise business abnormal records will be generated.

4. Ecuador has a high-frequency pit for customs clearance and payment collection. Newbies must avoid it.

Pit 1: The age and displacement of the vehicle are misstated and returned directly to the port

Many people try to sell more cars, conceal the factory year and falsely report the displacement. The Ecuadorian customs system can inquire the original vehicle parameters. Once they do not match, the entire vehicle will be returned for shipment. The round-trip sea freight and storage fees will be borne by the exporter, and the losses will start at tens of thousands.

Pit 2: Ignoring the restrictions on returned overseas Chinese policies, buyers cannot get their cards

Repeatedly confirm with the customer in advance: Only if the buyer has lived overseas for 2 years and stayed in Ecuador for no more than 180 days in the past 2 years can he be eligible to use the household luggage channel; if the customer's qualifications are not up to standard, the vehicle cannot be cleared at the port, and can only be stranded in the port. High storage fees are incurred.

Pit 3: Foreign exchange settlement is not standardized, and qualified companies cannot cancel it

Foreign customers must be allowed to transfer money from public to private to public to foreign currency accounts of export-qualified enterprises. Private cash and third-party exchanges and transfers will make export licenses impossible to be written off, affect the subsequent export qualifications of enterprises, and even trigger tax verification. Newbies give priority to making a 30% deposit + paying the final payment on a copy of the bill of lading to reduce the risk of customers abandoning the car.

Pit 4: The document information is inconsistent, and customs clearance is postponed indefinitely

The VIN code, vehicle year, and value on invoices, bills of lading, certificates of origin, and registration certificates must be completely unified. If one character is wrong, the customs will not release them; all documents will be translated into Spanish uniformly. The official language of Ecuador is Spanish, and the English document review speed is very slow.

Pit 5: Blindly press a large amount of inventory and find customers

South America has a long shipping cycle and rapid policy changes. Newbies should not hoard cars before looking for buyers. It is best to lock in stable buyers in Ecuador first, receive a deposit before collecting cars and leaving the car to reduce the risk of capital occupation.

5. Some practical suggestions for beginners to get started

1. At the beginning, priority should be given to domestically produced compact cars and small SUVs with a displacement of 1.5L to 2.0L and models that were 3 to 4 years old. They were the ones with the largest local demand and the highest customs clearance rate.

2. The logistics side has a priority and fixed cooperation with the special freight forwarders of the Port of Guayaquil. They are familiar with South American customs clearance rules and can explain the loopholes in the documents to you in advance.

3. Long-term cooperation with 1-2 local reliable customs clearance banks will make them more familiar with returned overseas Chinese materials, local tax payment and licensing procedures, which can reduce communication costs.

4. In the contract, clearly state how to divide customs clearance responsibilities, how to handle return shipments, and who will bear the overdue storage costs. Don't argue with overseas buyers.

5. It is necessary to pay regular attention to Ecuador's customs policies. The import rules of various South American countries are always fine-tuned, and vehicle age and displacement restrictions may become stricter at any time.

Source: Digital used car exports

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