5 STEPS TO HELP REDUCE COST OF PURCHASING AND IMPORTING VEHICLES

The task of buying and subsequently shipping a car from another country may involve certain processes, the buyer may, however, want to as much as possible reduce cost whiles at the same time ensure convenience and safety in order to protect the investments made in acquiring the vehicle. The following steps can be considered to help reduce cost when purchasing and shipping vehicles overseas.

1.   The sourcing location for the vehicle

The location from where you source or buy a vehicle could have a significant impact on the cost of transportation. Depending on the Port Of Destination (POD) you may want to consider the Port Of Loading (POL), for instance, a car shipped from the far East or Asia to the west coast of Africa may attract higher freight rate than that from saying the Americas or Europe (all things being equal)

Also, take note of the inland transportation that may be needed if your purchased vehicle is located in a hinterland state hence you must factor in the inland transportation cost of the vehicle to the nearest port for onward shipments. You may, therefore, want to consider purchasing a vehicle from a port state or that closer to a port.

2. Consider the age of the car

Considering the age of the vehicle could also have a great impact on the final cost of the vehicle as most countries(especially those that serves as huge markets for used cars) have age limitations on the kind of vehicles that are imported into them. When a vehicle exceeds the allowable age, certain sanctions may be applied. In Ghana for instance, a vehicle which is more than10 years old from the year of manufacture (NB. Year of manufacture and not the year of first registration) would attract an over aged penalty to be applied at a rate depending on how old the vehicle is. This could significantly affect the clearing cost of your car as you could pay between 5% to as much as 50% of CIF value as overage penalty alone.

3. Method of shipments

With the issue of sourcing location and the age of the vehicle addressed, you may now want to consider the most cost effective method of shipping your vehicle. Overseas vehicle shipments can be done with two methods thus either shipping in a container or opting for a Roll-On Roll-Off (RORO) service. Even though RORO presents a cheaper option you may still want to consider the pros and cons of both methods in relation to the cost, convenience, service availability at certain geographic locations(Ports), frequency and availability of handling facilities at both Port Of Loading and Discharge etc.

4. Purchase car from a dealer

One low-risk way of purchasing a car would be to contact a certified car dealer instead of an individual seller unless you may have more reasons to trust this individual. A car dealer probably has a repeated business of shipping cars overseas and may, therefore, advice you on possible ways to reduce cost in shipping your car since car shipments may be more of a “ritual” for him.

Moreover, car dealerships do not only provide you with secure purchasing process but may also serve as agents for you at the port of loading to ensure your vehicle is loaded and shipped safely a service which may not be provided by  private individual sellers as they may not have the time and hence you may have to look for a representative at an extra cost in the country of origin if you are not physically present there. A dealership also presents you with an established office to call if something should go wrong.

5. Customs valuation

This is a very crucial aspect of the entire overseas car purchasing process. Different countries would have different methods of evaluation of cars for customs clearance purposes and it is very important that you have a fair idea of the methods used and if possible and estimation of possible duties and taxes to be paid on a vehicle even before importing it to prevent disappointment once the vehicle arrives.

In Ghana, for instance, you can contact your freight forwarder (clearing agent) with certain details like the chases number of the intended car to be shipped, this information can then be forwarded to a customs valuation officer to give you a fair estimate of what is expected to be paid for clearance when the said car arrives. Also, try to start your clearance process early to avoid extra cost in demurrage and rent charges.