Is it good to export used cars to Africa?

Some people say that this is a wind outlet, and you can earn money by selling a car casually; others say that the water is too deep, and laymen who go in will pay tuition fees. Today, we will not brag or engage in routine, and we will explain the real situation, opportunities, and risks thoroughly in one go.

1. Let's start with the conclusion: The market is really big, but it's not about picking up money.

Give the answer directly to Africa's second-hand car exports. You can do it and make money, but it is definitely not a lie. It belongs to the "dividend industry with thresholds"-people who understand the rules make money steadily, and people who don't understand can easily lose money in freight, customs clearance, and policies.

2. Why is the African market so popular

Many people still have the impression of Africa as "backward and without need", but the reality is completely different. The demand is extremely strong, and almost everyone needs second-hand cars. Africa's population exceeds 1.4 billion. The number of cars per thousand people is extremely low, and ordinary families simply cannot afford a new car. 80% and 90% of the cars running on the local roads are second-hand cars, which is a real rigid demand. Pickups, SUVs, and durable cars are the most popular in Africa. The road conditions are complex. The first requirements for vehicles are: durable to manufacture, solid leather, and easy to find parts. Models such as Toyota Hailax, Corolla, RAV4, Honda, and Nissan are "hard currency" locally and have almost no worries about sales. In recent years, domestic used cars have become more and more cost-effective, and they have also begun to increase rapidly in Africa. The profit margin can be clearly seen in domestic vehicle collection, preparation, testing, customs declaration, and shipping. After a set of processes, it is common for a bicycle to make a profit of several thousand to more than 10,000. If the goods are shipped in large quantities and stably, the benefits will be considerable.

3. The biggest pits in this business are hidden in the details

The opportunities are big, and the risks are equally real. Many novices lose money by "taking it for granted". Each country's policies are different. If you make one mistake, you cannot clear the car closure age limit for a few years, whether emissions should be Euro IV or Euro V, whether left rudder or right rudder, whether third-party testing is needed... If one detail does not match, the car will be detained at the port. Detention fees, freight, and storage fees can directly absorb profits. Not all cars can sell African unpopular cars, luxury cars, and cars with complex maintenance. It is difficult to sell them in Africa. Local people only look at three things when buying a car: whether it is easy to repair, whether the accessories are expensive, and whether they are durable. Logistics, customs clearance, money collection, shipping cycles, fees at the destination port, local customs clearance capabilities, foreign exchange settlement, customer reputation, etc. Any failure of the chain may lead to funds being trapped, trucks and goods being empty.

4. What kind of person is suitable for doing

If you meet the following, you can safely enter the market for used cars exporting to Africa: you can connect to the sources of used cars and are willing to spend the time studying export policies and procedures, are willing to learn, accept a one-month capital turnover cycle, and do not want to involve the domestic used car price war. If you want to open up new channels for foreign trade, you are recommended not to do it or blindly invest in it.

5. The last truth

The export of used cars to Africa is not a scam, nor is it a myth of sudden wealth. It is a high-quality track with real existence, relatively continuous growth in demand, and gradual liberalization of policies. People who do well never rely on luck but: choose the right country, choose the right model, follow the right process, and stabilize channels. In the next few years, Africa will remain the most important incremental market for China's used car exports. The opportunities to understand the rules and enter the market steadily are much greater than those in the domestic market where the internal market is involved. If you are considering entering the market, you can also start with small orders and stable orders instead of investing heavily at once.

Source: Xiong Yu, digital automobile export

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