Grey Imports and Insurance
Grey imports are vehicles imported from outside the EU. They have never been available in the UK. Most often they are Japanese or American models with higher specifications. Should you buy a grey import? If the Grey Import is in the UK, you won’t need to worry about import fees or VAT. Why do people import Japanese Domestic Market (JDM) cars? JDM cars can be a great option to source a vehicle in better-than-average condition.
Import Costs and Car Prices
Importing used cars is now far more complicated and expensive. The average new vehicle costs nearly $49,000, almost $10,000 more than before the pandemic. Vehicle imports offer a favorable alternative. The more expensive the car, the smaller the price difference. Higher inflation also impacts prices.
It’s expensive to own a car in Japan. The country requires multiple costly annual inspections, parking fees, and taxes when purchasing. After WWII, Japan still lacked oil reserves. With fuel scarce, Japan specialized in small, fuel efficient cars. Japanese cars are better engineered, safer, and longer-lasting than American cars.
When an imported car is from the EU, it meets the same safety standards as UK cars. This means grey imports are normally more costly to insure than EU imports. Under Brexit, there is no tariff on UK-EU imports/exports. Standard insurers may cover parallel more than grey imports. As with grey imports, parallel imports can be left-hand-drive. This raises insurance costs.
Insurers see imported cars as “higher-risk.” Imports often cost more to repair and have more power. Insurers greatly raise premiums or refuse to insure imports.
Cars in Britain are up to 52% more than the EU due to transportation costs. Poland has the EU’s cheapest cars.
So imported cars have more value. The average imported car price is $7,000 higher than one made domestically.
Exchange Rates and Market Factors
Warranties may also cause difficulties with imported cars. Subarus are inexpensive due to low import tariffs and lower Japanese labor costs. Currency manipulation also plays a role.
The British pound has traditionally been stronger than other currencies. As most UK vehicles are imported, this raises prices. The UK’s higher cost of living also factors in.
Are imported cars more expensive? Imported cars are more expensive due to extra fees, taxes, and regulations when bringing them into a country. Exchange rates between currencies also impact costs. Labor expenses factor in too.
Japan has strict three-year inspections. So used vehicles are inexpensive when exported.
Car prices differ across Europe based on local taxes, wages, and transportation fees.
Even foreign cars made domestically can be expensive due to import taxes, tariffs, and currency values benefiting exports over imports.
Higher-end parts and limited local availability make servicing foreign luxury cars pricier. But for some buyers, imported vehicles provide exclusivity and custom options worth the extra investment.
Import Process and Insurance Implications
Why do people import Japanese Domestic Market (JDM) cars? Japanese import vehicles are often in better condition both mechanically and cosmetically than you find when looking at a used vehicle that was sold new in your country.
Insurance is normally more expensive for imported cars because they usually cost more to repair, and are often higher-spec, and with more powerful engines, than standard cars.
You must complete certain steps as soon as you bring a vehicle into the UK permanently. Or you can pay an importer or shipping company to do them for you.
With fuel in short supply, Japan began to specialize in smaller, cheaper cars that used as little fuel as possible. Many foreign used cars are much less expensive than their American-made equivalents.
Cars are up to 52% more expensive in Britain than anywhere else in the European Union, according to the latest EU price survey. Price differences across countries may arise simply due to transportation costs. Poland has emerged as the cheapest EU country to buy cars.