Autos and Auto Parts in South Africa

[cyppok]

Hi was wondering about the general market out there.

Average costs for new and used cars and age of fleet would be interesting to know.
Also how much a person generally spends. What are the majority of makes and models in use.

Is it really feasable to ship parts from elsewhere for American cars or not if most of the parts are locally made.
What kind of excise taxes are there on new and used cars. What kind of excise taxes on auto parts shipped.

Was wondering cause one of my friends ships to Russia, Ukraine etc... and the excise taxes are very high but locally the cars cost far more so theoretically it is still profitable to ship due to various factors.

[dfsa]

Dude, this is actually the wrong place to ask that question. This is a South African Forum.

From a South African perspective regarding the Motor Trade!! We have always been screwed and will be screwed for a very long time still to come. Our Motor trade is protected by Government. We Pay on average 3 times and more for our motor cars. That include spares.

Main reason is we have manufacturing plants for: Mercedes Bens, BMW, Volkswagen, Ford, Masda, Nissan etc. Hyundai is just across the border in Botswana, but were set up there purely for the SA market.

All these plants do export to other countries on selected models.

As South Africans we are bound to buy local. If we do however buy imported cars, we pay through our neck for them, because of the duties.

Looking at your US market from the outside, it is also simple to explain. Your government and their rich dictating business people, have systematically been breaking down the used to be strong US economy by moving their Plants and Manufacturing set ups to Asia for more profits.

At this stage, by looking from the outside, your motor car and spares cost is still cheap. Also do not fool yourself by thinking your spares are all made locally.

One recent example: Why do you think your once powerful space program NASA has closed most their operations. Simple, it is cheaper ( Not really, they simply make a bigger profit from US taxes) for them to give their knowledge away and do their operations in another country.

Sit down, then look back 20-30 Years ago and see how powerful your motor trade and manufacturing was, then look at it Today and you will find your local industry is virtually gone. It is most probably only 30% of what it used to be.

Go to one of your free ways on peak time and look at the % of 100% local US produced cars you can see. Well you will be shocked.

Your Friend who ships to Russia etc. Well he found a niche market. You will most probably find that the people who do buy those spares and cars, are financially above the other 90% in those countries.


What cars are mostly driven in the world? Toyota, Mazda, Nissan, and other Asian models.


On a global scale, US made cars represent only about 4-6% outside of the US.

[cyppok]

I am afraid you do not understand the dynamic.
The tariff for cars is about 60% or more in Ukraine and Russia.
No idea where Mercedes makes cars in North America, South Carolina for BMW I think etc...
Say you get a Mercedes at 80k with full tarriff its 148 to Russia or Ukraine giver or take. The local dealer has it at 180-200 simply because they want to make at least 20% on the total price. If you have a customer directly you can split the dealer overhead and make a few grand. Thats about it...

This is the right place I am asking about South African tarriffs and excise taxes on cars/parts shipped to South Africa... Was curious about general costs of parts etc...

Even for auto parts its cheaper for the stores to buy from you which is odd but true. I was simply wandering what the tarriff rate was.

[dfsa]

So what makes of cars do you plan to sell over here? What motor plan do you offer, who is covering the warrentee, who is going to do the services.

Here is one example of how our local industry is protected: Ever heard off "Japan Cars" These cars are not allowed to be sold in SA, although they get imported for the African market via our ports. "Japan Cars" example a RAV4 sell for around 8-12k $US IN Africa. In South Africa this same Car with slightly different and better component package is costing around 50k $US. We simply are not allowed to buy the Japan Car version, as the local manufacturing industry will be closed down within a Year.

So give us an idea on what make car you are talking about, then we can give you a more accurate indication on cost. Our duties vary from manufacturer to manufacturer.

If you are looking at exotic cars, then you do stand a better chance of profiting.

What you must keep in mind is that Ukraine and Russia etc will buy cars that are not Russian made. Take your Mercedes example: Not sure what model you talk about, but let us assume it is a C class model. We assume the 80k include all tariffs and shipping to SA and come to 148k $US. Well you will not get a buyer, because you are now 2-3 times to local price. To now go further, you still did not allowed for your profit, motor plan costing etc.


So again, let us know what models and makes of cars you look at, then also let us know what spares you talk about, then we can give you a more accurate answer. Heck maybe you find a local partner here.

[cyppok]

So what makes of cars do you plan to sell over here? What motor plan do you offer, who is covering the warrentee, who is going to do the services.

None yet, I am just asking about the market.

Here is one example of how our local industry is protected: Ever heard off "Japan Cars" These cars are not allowed to be sold in SA, although they get imported for the African market via our ports. "Japan Cars" example a RAV4 sell for around 8-12k $US IN Africa. In South Africa this same Car with slightly different and better component package is costing around 50k $US. We simply are not allowed to buy the Japan Car version, as the local manufacturing industry will be closed down within a Year.

Toyota Rav4 is about 23-26k in the U.S. I know this because I helped my uncle buy one for himself about three years ago. In Ukraine it was about 39-45k, around 43k in the dealership. I think the Rav4 is made in the states to be honest, the one that is sold here anyway.


Again just asking you about the market. If the tarriffs are not across the board it doesn't make sense. Also why wouldn't the warranty and services be transferrable to SA or if not you pay I guess.

It does seem that since the mercedes is pretty cheap in SA most of the other cars simply sell less etc... and it might not make sense for this anyway. But just curious about market really.

[dfsa]

Also why wouldn't the warranty and services be transferrable to SA or if not you pay I guess.

You would need to have a deal with a local dealership that would be willing to take ownership of the warranty and services. I don't think any of them would be interested. Maybe if you offer exotic Motor Cars, then you might find somebody that would take the services and warranty over.

Toyota Rav4 is about 23-26k in the U.S. I know this because I helped my uncle buy one for himself about three years ago. In Ukraine it was about 39-45k, around 43k in the dealership. I think the Rav4 is made in the states to be honest, the one that is sold here anyway

The local RAV4 is more or less in the same price bracket than you have there.

You would need to offer a make and model that is not very well represented here. The following American Cars ( Head offices might be in the States, but for the global market most have plants outside the States) are well presented already:: GM: Chevy, GMC, Pontiac, Buick, Hummer. Dodge, Chrysler, Jeep. Ford, Lincoln, and Mercury

From the above American Makes/Models you might find local buyers from the top income earners that would buy just because it is different: Chevy, GMC, Buick, Lincoln, and Mercury are available, but at a high cost. If you can have good deals on these, you should make a few sales.

For some reason you actually evade my main question: What make and model do you have access to and at what sort of costing are you talking about inclusive of delivery CIP to Port of Durban. From there we can possible give you more detail of any final costing.

[adrianh]

I am sure that local law prohibits left hand drive cars?

[dfsa]

I am sure that local law prohibits left hand drive cars?

Adrian, I think you nailed that one. I did not even think on left hand drive. I think you can have one, but would need special permission. This would normally go for exotic cars.

Reason why I say that is I have seen some Ford F150,s (It is an impressive Bakkie) in Gauteng. I did not take notice on driver position though. I do however see some left hand drive cars around.

All Hummers (Ugly damn car with heavy price tag) I have noticed is right hand, but they would have been made for the European country's.

[adrianh]

I know that you can no longer import them and register them. I think that the one's that were registered before a certain date are still legal.

I don't know whether you are even allowed to convert them from left to right hand drive. I suppose it would have to be done before the car crosses our borders. You can't even buy a car in Namibia and bring it over without paying hectic import duties.

[cyppok]

For some reason you actually evade my main question: What make and model do you have access to and at what sort of costing are you talking about inclusive of delivery CIP to Port of Durban. From there we can possible give you more detail of any final costing.

I am just trying to figure out if a market exists, it seems doubtful from what you have said. Basically you have local producers (Botswana) and the prices are normal vis a vis American ones, just being out of line for cars not made near SA.

I figure insurance is around 1-2k for a car depends on cost/distance etc...
Technically you could buy anything here and ship it there I assume provided you pay customs and whatnot but I have no knowledge first hand experience wise.

What about car parts for American and some Japanese cars, wouldn't there be a niche to ship em to some auto service providers?

[adrianh]

We have hardly any American cars on our roads. Our Japanese cars are produced locally. There are of course the hot rodders who run American V8;s but they are few and far between. Strangely, we have a proliferation of Chinese cars. The Chinese cars should be cheap but they are not. Although 95% of our cars are produced locally and most of the production is exported, we still pay hefty prices for cars and parts. Our car industry is very protective of itself and have a lot to say about 'pirate parts' even if those parts are genuine but imported via unofficial channels. Another issue is the exchange rate, imported American products are extremely expensive locally.

Given the exchange rate, you may be better off importing stuff from South Africa and selling it in the US. I am not just talking abour car parts, maybe there is a market for leather iPad and iPhone5 covers for example. The trick would be to create a high value niche markets. I am not saying that the products need to have an African bent either, the products could be made to your specification.

[greasemonkey]

Slightly off topic but maybe it can clarify some points

http://www.ritztrade.com/south-africa-cape-town-johannesburg/south-africa-further-services/import-regulations/import-regulations.php

[cyppok]

Might make sense for shipping Mercedes to Russian Far East if the price for shipping isn't exorbitant and you get vat exclusion. Problem is I don't know anyone there. Wondering car part prices though more to be honest.