By: Gov Auctions | 3 November 2014
Exporting Cars from US - Things You Need To Know (part 1)
Every year more people consider exporting cars from the United States. There are a variety of factors which play into this decision; regardless of why someone is exporting cars there are a number of important facts which must be considered. There are not only legal ramifications and regulations to make note of, but also a variety of factors which may influence the overall profitability of the endeavor.
Why Do People Export Cars from the US?
The first question which must be answered is why people export cars from the US. While every individual may have a different reason there are two driving economic forces behind this growing phenomenon. Exporting cars from the United States was typically the domain of resellers and dealerships until the past five years. Once the average consumer discovered how easy this process is a growing number of individuals entered the competitive marketplace as well.
1. US is Buyers’ Market – Globally a Sellers’ Market
Currently, the US is considered to be a buyers’ market. This is particularly true for used vehicles. Over the past three quarters there has been a massive influx of use cars available for purchase. Previously, a shortage of use cars was due to the recession which began in 2008. Beginning in 2010 individual consumers once again became comfortable policing vehicles and purchasing new vehicles. This has led to an influx of late-model vehicles into the secondary market. Not only has this driven down prices but it shifted the balance of power in the US from the seller to the buyer.
On the other hand, the global automotive marketplace is still considered a sellers’ market. This means the seller is still in control of the negotiations and can maximize their margins which increases overall profits. This is particularly true because of the continually high demand of US vehicles in Asia and Eastern Europe. Since it is difficult to get American-made vehicles and of these areas buyers are willing to pay a premium.
2. Auto Auctions in US Offer Significant Savings
The second driving force behind the increasing popularity of exporting cars from the US is the growing number of auto auctions available to the public. Auto auctions have long been known as an excellent way to save money on a reliable used car, but it wasn’t until recently that individuals have taken advantage of auctions to generate income. Previously, they tried to generate income by reselling the vehicles locally. However, with the advent of Internet auto sales as well as the need for individuals to generate additional sources of income the popularity of using auto auctions to buy cars solely for export purposes has skyrocketed.